The social media platform X has lost 71% of its value since it was bought by Elon Musk, according to the mutual fund Fidelity.
Fidelity, which owns a stake in X Holdings, said in a disclosure obtained by Axios that it had marked down the value of its shares by 71.5% since Musk’s purchase.
Musk acquired Twitter for $44bn in October 2022 and renamed the platform X in July 2023. Fidelity’s estimate would place the value of X at about $12.5bn.
The number of monthly users of X dropped by 15% in the first year since Musk’s takeover amid concerns over a rise in hate speech on the platform.
The alternate definition is “discounted future earnings”.
So if I have a cardboard box with $100 inside, it’s worth $100 even if nobody will buy it.
If I have a machine that will print an authentic $100 bill exactly once, it’s worth $100 even if nobody else believes it will work.
Thus, something can be worth more (or less) than its selling price.
The $100 contained inside the box wouldn’t be the box’s “worth”, it would be part of the box’s worth. It would be $100 PLUS whatever somebody is willing to pay for the box itself.
The $100 inside the cardboard box is Twitter’s physical assets. But the current physical assets owned by Twitter are only part of the equation, there is still an inherent worth in owning the company itself, and possible income in the future.
That doesn’t make the box’s worth $100 or $0, it makes the box’s worth “At least $100”.
But how do you define the value of a $100 bill? Is it worth one hotdog, 100 hotdogs or as many hotdogs as someone is willing to trade for it?