Elon Musk’s X gets another valuation blow by Fidelity

Investment giant says X platform is now worth 71.5% less than what it was at the time of X’s Musk takeover

Kate Mills - Jan 03, 2024

A representational image displaying the logo of X. — Unsplash

Fidelity, the biggest shareholder of X, has dropped the valuation of X in a monthly assessment that it conducts of its private shares.

The investment giant said the platform is now worth 71.5% less than what it was at the time of X’s Musk takeover, according to a new securities filing.

In another revaluation session in November 2023, Fidelity had slashed the platform’s worth by 10%, purportedly led by the heated fiasco that took place as a result of the display of anti-Semitic content on the platform, as per a CNN report.

Fidelity's Blue Chip Growth Fund recently filed a report on December 30, providing information up to November 30. As per the filing, Fidelity owns shares of X valued at approximately $5.6 million.

The report mentions that these shares make up less than 0.01% of the total fund value, which is over $49 billion. This is a significant decrease from the earlier value of $19.66 million when Elon Musk acquired Twitter and 14.5% less than the value of $6.55 million reported last April.

Fidelity in April 2023 gave Elon Musk over $300 million to buy X. However, now Fidelity believes that its investment is worth less than half of what it originally paid. The value of the investment was lowered by Fidelity just one month after Elon Musk bought X. Similarly, the mutual fund In October assessed the value of its shares in X at a 65% discount.

Fidelity raised its estimated value of X a bit last summer when Linda Yaccarino became X's CEO. However, after that, Fidelity has been consistently lowering the estimated value of its X shares. Since X is not a publicly traded company, Fidelity's estimates are closely observed to gauge X's well-being and to understand the sentiments of Elon Musk's investors.