Elon Musk, the owner of Twitter, has revealed in an internal email that the current value of the social media platform is $20 billion, which is less than half the $44 billion he paid to acquire it five months ago. This was disclosed in reference to a new stock compensation programme in the San Francisco-based company and the allocation of shares to employees of X Holdings, Twitter’s umbrella company since Musk purchased it in late October. The compensation plan values the platform at $20 billion, which is slightly more than the publicly traded companies like Snapchat’s parent company Snap ($18.2 billion) or Pinterest ($18.7 billion).
According to Musk, Twitter was facing such grave financial difficulties that at one point, it was on the verge of bankruptcy. He cited a revenue drop of $1.5 billion a year and a debt-servicing burden of the same amount, leaving it with “only 4 months of money.” This brutal contraction in Twitter’s value was revealed in a message posted on the platform last weekend. However, Musk said that Twitter would break even in the second quarter of the year, with advertisers, many of whom fled the platform after he bought it, now returning.
Musk, who is also the CEO of Tesla Inc. and SpaceX, stated in the email that he sees a “clear but difficult path” to a valuation of $250 billion, without specifying how long that might take. Since taking control, he has sharply cut the group’s payroll from 7,500 employees to fewer than 2,000.
In another setback for the company, fragments of Twitter’s source code were published on the development platform GitHub. GitHub removed the files from its site at Twitter’s request, but their brief exposure could allow hackers to identify flaws in Twitter’s original software. While Twitter has not confirmed the news reports about the internal email, it has generated buzz and speculation in the media.