Elon Musk Admits That Twitter Is Worth Less Than Half What He Paid for It

It’s been less than six months since Elon Musk bought Twitter (it feels a lot longer, doesn’t it?), and the company’s value has already dropped by more than half.

The social-media giant is currently worth about $20 billion, down from the $44 billion Musk paid for it in October. That’s according to an email he sent to employees on Friday, which was reviewed by The New York Times.

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“Twitter is being reshaped rapidly,” Musk wrote in the missive, calling the company “an inverse start-up.” (He did not respond to the Times’ request for comment.)

Musk sent Friday’s email to announce a new stock compensation program at Twitter, but it’s perhaps more notable for what he said about the website’s financial situation. The Tesla and SpaceX founder warned that Twitter’s finances were precarious, and that it had once been four months away from running out of money. To avoid a dire fate, he said, the company’s previously announced layoffs and cost cutting were necessary.

In the past, Musk has stated publicly that Twitter was at risk of declaring bankruptcy. After he took over the company last year, advertisers jumped ship and the social-media site lost revenue. Because Musk took Twitter private, though, it doesn’t have to reveal information about its finances, so this most recent note gives us a rare peek into the company’s struggles.

As mentioned, the email also outlined the new stock program, in which Twitter employees will receive stock in Musk’s X Corporation, the holding company he used to the buy the site. Similar to how it works at SpaceX, the program will allow workers to sell stock every six months, giving them “liquid stock, but without the stock price chaos and lawsuit burdens of a public company,” Musk wrote. The awards will be doled out based on the current, $20 billion valuation.

Despite the largely bad news, Musk said in his email that he thinks Twitter could eventually be worth $250 billion. It seems like the company has a long way to go until it reaches that point, though—if the website doesn’t fully implode before then.

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