Global investment firm Fidelity has significantly reduced the value of its holdings in Elon Musk's social media platform X (formerly Twitter) by 78.7%, signaling that the company is now likely valued at just $9.4 billion.
Musk had acquired the platform in October 2022 for $44 billion, following a high-profile takeover saga.
According to recent filings by Fidelity, X's current valuation is less than a quarter of the original purchase price. The fund now values its stake in X at approximately $4.18 million, down from $5.5 million in July.
Neither Musk, X, nor Fidelity has commented on the report based on the latest regulatory filings.
Fidelity has made multiple cuts to the valuation of its investment in X Holdings, the parent company of X, over the past year. In January 2023, it reduced its valuation by 71.5%, and this latest cut reflects the ongoing financial challenges the platform faces.
Musk took out $13 billion in loans to finance his acquisition of Twitter, promising lenders that they would not incur losses. However, there are concerns that the lenders may recover less than 60 cents on the dollar from the bonds and loans involved.
Despite the challenges with X, Musk's AI company, xAI, raised $6 billion earlier this year for the development of new technologies, with key investors like Fidelity backing the project.