Twitter‘s valuation has dropped sharply since Elon Musk’s takeover last year, the CEO told employees in an email.
Mr. Musk bought the social media company for $44 billion in October and took it private, only to see its value diminish to about $20 billion, he said in an email that was shared with The New York Times.
Twitter‘s new owner told workers that the company was once four months away from running out of cash and that the social media company should be thought of as an inverse start-up as it works to avoid additional financial pain.
Fast changes took place at Twitter soon after Mr. Musk‘s takeover last year, with large cuts to the workforce and advertisers growing skittish amid concerns that modified rules would expose their products to appearing alongside controversial content.
Twitter shed about half of its 7,500 employees in November 2022, according to a tweet from the company’s then-head of safety and integrity Yoel Roth.
Mr. Musk said on Twitter in November 2022 that his company had seen a “massive drop in revenue, due to activist groups pressuring advertisers” despite that he had not yet overhauled the company’s rules.
Despite the financial struggles at Twitter, Mr. Musk‘s March 2023 valuation places it ahead of Snap, the parent company of Snapchat, which has a market capitalization estimated to be approximately $18 billion, according to CNBC.
Twitter is not alone in making cuts, as Big Tech companies have imposed layoffs affecting tens of thousands of workers. For example, Amazon has plans to eliminate a total of 27,000 jobs in 2023, while Google said in January it was getting rid of approximately 12,000 workers.
• This story is based in part on wire service reports.