NEW YORK - Twitter is now worth just one-third of what Mr Elon Musk paid for the social media platform, according to Fidelity, which recently marked down the value of its stake in the company. 

Mr Musk, who has acknowledged he overpaid for Twitter, offered employees new equity grants earlier in 2023 that valued the company at US$20 billion (S$27 billion).

It is unclear how Fidelity arrived at its new valuation, or whether it receives any non-public information from the company. 

Fidelity first reduced the value of its Twitter stake in November, to 44 per cent of the purchase price.

That was followed by further markdowns in December and February. 

Twitter has struggled financially since Mr Musk took over.

After saddling the company with US$13 billion of debt, Mr Musk’s erratic decision-making and challenges with content moderation led advertising revenue to decline by 50 per cent, Mr Musk said in March.

An attempt to recoup that revenue by selling Twitter Blue subscriptions has so far failed to take off.

At the end of March, less than 1 per cent of Twitter’s monthly users had signed up.

Twitter did not specifically respond to a request for comment.

Mr Musk’s investment in Twitter is now worth US$8.8 billion, according to the Bloomberg Billionaires Index, which uses Fidelity’s valuation to calculate the value of his holding.

Mr Musk spent more than US$25 billion to acquire an estimated 79 per cent stake in the company in 2022.

The latest markdown erases about US$850 million from Mr Musk’s US$187 billion fortune, according to the index.

Despite Twitter’s issues, Mr Musk’s wealth is up more than US$48 billion in 2023, largely due to a 63 per cent surge in Tesla’s share price. BLOOMBERG