SAN FRANCISCO — Elon Musk said Twitter is now worth about $20 billion, a significant drop from the $44 billion he paid to buy the social network in October, according to an email he sent to the company’s employees on Friday.
The email, seen by The New York Times, was sent to employees to announce the new stock compensation plan. In it, Mr. Musk warned workers that Twitter was in dire financial straits and, at one point, was four months without money. He said “radical changes” at the company, including massive layoffs and cost-cutting, were necessary to avoid bankruptcy and streamline operations.
“Twitter is reshaping quickly,” said Mr. Musk wrote that the company could be considered “a reverse startup.”
Twitter’s value has plummeted as Mr Musk has dramatically overhauled the company. In October, Mr. Musk has taken Twitter private, meaning it is no longer obligated to provide transparency about its finances. But the billionaire has publicly indicated that the company lost revenue as advertisers left the platform after his acquisition, and suggested that Twitter was at risk of bankruptcy.
Snapchat’s parent company, Snap, is worth slightly more than Twitter at $20 billion, which has recently struggled with advertising declines and predicted a drop in revenue. Snap, which has a market capitalization of about $18 billion, had 375 million daily active users, compared with Twitter’s 237.8 million at the company’s last public offering before it went private.
For comment, Mr. Musk did not respond, and an email to Twitter’s communications department was returned with a poop emoji. The new rating of the company was reported earlier Information.
Regarding the new stock compensation plan, Mr. According to Musk’s email, Twitter employees will receive shares in X Corp., the holding company he used to buy the company. Those awards are valued at $20 billion. Mr. Musk said in the email.
Twitter will allow employees to sell stock every six months, Mr. Musk added that this is the practice at SpaceX, his private rocket manufacturer. Mr. Musk wrote.