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Months after the valuation of X (formerly Twitter) was estimated to have fallen by 80 percent, investors are now pegging the social media platform’s value at $44 billion, the same amount Elon Musk purchased the site for in 2022.
According to The Financial Times, investors are now exchanging stakes in the company at increased value in a secondary deal as the world’s richest man looks to raise additional capital to pay off some of the debt he financed to buy X. The Times reported that in a primary round, Musk aims to bring in $2 billion through selling equity in the company, which will be used to offset a billion dollars in junior debt.
“The new $44bn valuation represents a rebound for Musk and the group’s investors, including Andreessen Horowitz, Sequoia Capital, 8VC, Goanna Capital and Fidelity Investments. The deal would help set a price for the upcoming primary round,” the Financial Times noted.
Bloomberg reported last month that Musk was pursuing a new round of fundraising that would value X at the same price he acquired it for — which he admitted at the time he was “obviously overpaying” to buy the social media platform. This also represents the first time that Musk has raised money for the site since he took it private following his acquisition of the then-Twitter.
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Musk, who is now President Donald Trump’s “first buddy” and is in charge of the administration’s dismantling of the federal government, saw the social media giant plummet in value immediately after taking it over.
After firing roughly three-quarters of the company’s workforce and all but eliminating the platform’s moderation policies, along with utilizing X as his own personal megaphone to sound off on his increasingly extremist political views, Musk has seen a large chunk of users flee the site and a number of businesses pull their advertising.
With revenues initially sinking under Musk’s leadership, investment giant Fidelity Investments estimated last fall that its shares in the company were worth almost 80 percent less than they were at the time of Musk’s acquisition. This suggested at the time that the value of X was down to only $9.4 billion.
The turnaround in X’s price tag is likely due to several factors. One is that the company’s flatlining advertising revenue has possibly rebounded to pre-Musk levels. According to sources who spoke with the Financial Times, the social media platform recently posted about $1.2 billion in adjusted earnings for 2024, which is roughly equal to the company’s performance before the 2022 purchase. At the same time, though, one person who spoke to the outlet said the earnings figure was “wildly adjusted.”
Amid concerns among sponsors that their advertisements were appearing next to antisemitic and racist content, prompting a large-scale pullback of ad buys, Musk sued a global advertising alliance and blue-chip companies over the “massive advertiser boycott,” calling it illegal. “We tried peace for 2 years, now it is war,” he tweeted last August. Meanwhile, companies like Amazon — whose founder, Jeff Bezos, has cozied up to Trump in recent months — have increased their advertisement spending on X.
Besides the supposed increase in revenue, investors’ increased confidence in X could also be due to large Wall Street banks having sold the vast majority of the $12.5 billion in loans Musk took out to purchase the site. Interest in buying up the loans had greatly improved following Trump’s electoral victory and Musk’s emergence as one of the president’s top advisers and allies.
Growth in the valuation was also likely due to Musk sweetening the pot by giving a 25 percent stake in his artificial intelligence startup xAI to investors in X last year. Since then, the AI company has improved in value to $45 billion, adding additional security to investors in the social media site.
Still, as Musk is convincing investors that X — which he hopes to turn into a “do everything” app eventually — is worth $44 billion, his fortunes elsewhere haven’t been as rosy.
While he initially saw his net worth explode shortly after Trump’s election, much of that increase has dissipated in recent weeks due to the sharp market sell-off of Tesla, in which Musk has a massive stake. With the electric car maker experiencing plummeting sales across the globe and protests at dealerships in the United States, largely due to Musk’s far-right political pivot and alliance with Trump, the tech mogul’s shares in Tesla are no longer his most valuable asset.
The growing unpopularity of Musk and dwindling Tesla sales figures even prompted Trump to hold an infomercial for the EVs on the White House lawn earlier this month — despite the president’s longstanding disdain for electric cars. With several Teslas spread across the driveway and the president reading off pre-written facts about the cars, Trump stood next to Musk and promoted the “beautiful” vehicles — and even vowed to buy one personally.
“Everything’s computer,” Trump gushed after climbing into one car alongside Musk. Meanwhile, the president declared that anyone who vandalizes or sets fire to a Tesla would be treated as a “domestic terrorist.” Since then, the FBI’s Joint Terrorism Task Force has begun investigating arson attacks at Tesla facilities.
