It has been more than two months since Elon Musk finalized the long awaited deal to purchase Twitter. The new CEO paid $44 billion in October 2022 and completed the deal. Since Musk became the stockholder at Twitter, he has been pointing at the changes to revamp the platform for a greater good. But, the deal went through a flux with the company and Elon Musk at the loggerheads and a legal battle to obligate him to buy it. He implemented various reforms and policies once the purchase was done.
However, the revenue plummeted to a greater extent after the advertisers started pulling the deal. The company faced heavy losses. On top of that, due to the workforce, the company was losing a million per day. So, the billionaire reduced more than half of the global Twitter’s head count. In order to increase the revenue, he also introduced the $7.99 monthly subscription. But, after a debacle, he reintroduced it with some exclusive features. Elon Musk is facing a severe slump in his revenue and the net profitability of his entrepreneurial ventures is also plunging. How is Twitter affected by it?
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Elon Musk-Led Twitter’s Value Has Nearly Reduced To Half
In April 2022, Elon Musk and the Twitter board members assembled together to talk about the bid and hinted at a negotiation. This came on the heels when the Tesla owner was planning to buy the platform. The purchase amount was a whopping $44 billion.
So, he sold his stocks at Tesla with external fundings from banks and other organizations gathering the amount. Apart from them, there were 19 investors aiding Musk’s vision. One of them was the Fidelity Blue Chip Growth Fund.
The funding giant is one of the biggest asset management moguls. Fidelity’s stake valuations when Musk completed the deal was $19.66 million. However, after a month, in November 2022, the value plunged to approximately $8 million. This means the company lost around 43%. The company assured that it will invest $316 million in his deal.
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Tesla Is Not Faring Better Like Elon’s New Venture
On January 3rd, 2023, the Tesla stock prices continued to reach the abyss. It closed at $108.10 with a 12.24% decline. Elon Musk said that Twitter will aid Tesla in the long term. He sold the Tesla stocks worth $20 billion. But, the scenario is different. The company is receiving a heavy load of complaints with many features leading to a lawsuit due to misleading information about the beta feature.
In November 2022, Morning Consultant conducted a survey to check the net favorability for the electric car among the people based on their political leanings. Earlier, the Democrats were keen on buying the EV, and the Republicans had a considerable interest in buying it. But, after the Twitter deal, the percentage of Democrats fell by 20.3% with a marginal rise of 3.9% among the Republicans.
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