Elon Musk values ​​Twitter at $20 billion

SAN FRANCISCO — Elon Musk said Twitter is now worth about $20 billion, according to an email he sent to company employees on Friday, a significant drop from the $44 billion he paid to buy the social network in October.

The email, which was viewed by The New York Times, was sent to employees announcing a new stock compensation program. In it, Mr. Musk warned workers that Twitter remained in a precarious financial situation and, at one point, was four months away from running out of money. He said “radical changes” within the company, including massive layoffs and cost-cutting, were needed to avoid bankruptcy and streamline operations.

“Twitter is rapidly reshaping,” Mr. Musk wrote, adding that the company could be considered “a reverse start-up.”

Twitter’s value has declined as Mr. Musk has radically overhauled the company. In October, Mr. Musk took Twitter private, meaning he no longer has to be transparent about his finances. But the billionaire has publicly indicated the company lost revenue as advertisers fled the platform after it was taken over, and suggested Twitter was in danger of bankruptcy.

The $20 billion figure values ​​Twitter slightly higher than Snap, Snapchat’s parent company, which recently battled an advertising crisis and predicted its revenue would plummet. Snap, which has a market capitalization of around $18 billion, has about 375 million daily active users, compared to Twitter’s 237.8 million in the company’s final public disclosure before it went private.

Mr Musk did not respond to a request for comment and an email was returned to Twitter’s communications department with a poo emoji. The company’s new valuation was reported earlier by The Information.

According to Mr. Musk’s email about the new equity compensation program, Twitter employees will receive shares of X Corporation, the holding company he used to buy the company. These rewards will be granted as part of the $20 billion valuation. Mr. Musk also said in the email that he believes Twitter could one day be worth $250 billion.

Twitter plans to allow employees to sell the stock every six months, Musk added, similar to the practice of SpaceX, its private rocket maker. Private stock sales would allow employees to have “liquid stock, but without the stock price chaos and lawsuit burden of a public company,” Musk wrote.