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X says it is worth $19B, down from $44B last year

nytimes.com

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Re: X says it is worth $19B, down from $44B last year

#21

Post by kranke155 »

ilamont wrote: post #6

From a separate NYT article: Last year, Twitter’s interest expense was about $50 million. With the new debt taken on in the deal, that will now balloon to about $1 billion a year. Yet the company’s operations last year generated about $630 million in cash flow to meet its financial obligations. That means that Twitter is generating less money per year than what it owes its lenders. The company also does not appear to…

Wait, more job cuts? Sounds like slow walk into death to me, they seem to be barely keeping up and/or delivering any new features?

Re: X says it is worth $19B, down from $44B last year

#23

Post by kblissett »

ilamont wrote: post #6

From a separate NYT article: Last year, Twitter’s interest expense was about $50 million. With the new debt taken on in the deal, that will now balloon to about $1 billion a year. Yet the company’s operations last year generated about $630 million in cash flow to meet its financial obligations. That means that Twitter is generating less money per year than what it owes its lenders. The company also does not appear to…

Note that the article linked in this comment is a year old.

Re: X says it is worth $19B, down from $44B last year

#24

Post by function_seven »

kranke155 wrote: post #21
ilamont wrote: post #6

From a separate NYT article: Last year, Twitter’s interest expense was about $50 million. With the new debt taken on in the deal, that will now balloon to about $1 billion a year. Yet the company’s operations last year generated about $630 million in cash flow to meet its financial obligations. That means that Twitter is generating less money per year than what it owes its lenders. The company also does not appear to…

Wait, more job cuts? Sounds like slow walk into death to me, they seem to be barely keeping up and/or delivering any new features?

The quote is from a year ago.

Re: X says it is worth $19B, down from $44B last year

#25

Post by shapefrog »

wernercd wrote: post #12
gumballindie wrote: post #3

Earlier quoted context omitted.

Elon Musk could have let everyone work from home and save money on rent but he had to demand rto. Oh uh. Hope he fails soon, so others can learn.

Took Elon 17 years to get Tesla profitable... why do you think he'd give up in a year? The largest problem with businesses these days is the "we must make profit next quarter" mindset and the "I hope he fails" is either that - or a pocket dislike of free speech. Each option is questionable in it's own right. I hope Elon succeeds. Not because I agree with everything he says or does but because I value free speech. “I…

I, as a free speech advocate, agree Elon is free to say his core values are freedom of speech while censoring peoples speech.

Re: X says it is worth $19B, down from $44B last year

#26

Post by pstuart »

c420 wrote: post #13
XorNot wrote: post #8

Earlier quoted context omitted.

Yeah there's no way it's worth $19 billion. With its current expenses you can just sit back and wait for bankruptcy proceedings to pick it up cheap if you wanted it.

Was that his 4D chess plan all along?

The fact that he tried to get out of the deal is evidence that he had acted impulsively.

Re: X says it is worth $19B, down from $44B last year

#27

Post by fidotron »

silverbax88 wrote: post #19
arnvald wrote: post #11

I’m quite surprised it’s dropped “only” by 55%. Musk made the offer just before a big drop in valuation of tech companies. Even if Twitter revenue remained stable it probably wouldn’t be worth $44B Musk paid. With a drop in usage, drop in ads, controversy around the bots, misinformation, failure of Twitter Blue, I would expect that the actual value is quite below the said $19B. Maybe the cost saving measures partiall…

Agreed. It wasn't worth $44B when he bought it, so I'm not sure why the NY Times would even use that number in any way. If I pay someone $100,000 for a stick they found on the side of the road, it doesn't make that stick worth $100k. I doubt Twitter was worth $19B even before Musk overpaid for it. It was a 15 year old company that couldn't make money.

> It wasn't worth $44B when he bought it, so I'm not sure why the NY Times would even use that number in any way. If I pay someone $100,000 for a stick they found on the side of the road, it doesn't make that stick worth $100k.

This is almost exactly how accounting works. Whenever they want to decide how much something is worth the answer is the most someone else would pay for it.

Doesn't make it less insane, especially in the presence of idiots with huge sums of money.

Re: X says it is worth $19B, down from $44B last year

#28

Post by mikeyouse »

silverbax88 wrote: post #19
arnvald wrote: post #11

I’m quite surprised it’s dropped “only” by 55%. Musk made the offer just before a big drop in valuation of tech companies. Even if Twitter revenue remained stable it probably wouldn’t be worth $44B Musk paid. With a drop in usage, drop in ads, controversy around the bots, misinformation, failure of Twitter Blue, I would expect that the actual value is quite below the said $19B. Maybe the cost saving measures partiall…

Agreed. It wasn't worth $44B when he bought it, so I'm not sure why the NY Times would even use that number in any way. If I pay someone $100,000 for a stick they found on the side of the road, it doesn't make that stick worth $100k. I doubt Twitter was worth $19B even before Musk overpaid for it. It was a 15 year old company that couldn't make money.

A stick that someone paid $100k for is absolutely a stick worth $100k - what people are willing to pay for things is how we assign them value. Twitter's stock was trading at ~$45/share before any rumors of acquisition - so somewhere around $35B - they'd made roughly $1B in net income in the year prior to the buyout. This meme about them "not making money" is so silly. Aside from a one-time settlement in 2020, Twitter had a very stable and fairly profitable business - hence why Elon had to pay $44 Billion to buy the company from the existing shareholders.

https://www.statista.com/statistics/299119/twitter-net-incom...

Re: X says it is worth $19B, down from $44B last year

#29

Post by TheAlchemist »

$19B ?! I think they forgot the comma here. And even that would be generous.

All advertisers are gone - it seems like most advertising is some absolute crap. No way it brings any real money. Linda Yaccarino was recently caught lying (or rather, presenting the state of affairs in Elon's way) - suggesting and even naming some big brands that are supposedly back, while they are not (or spend 0.1% of their previous spending).

Creators revenue sharing seems to be a 'fake it till you make it' attempt - with first payouts an order of magnitude higher than the last ones. And of course, it's completely opaque - nobody has any idea what the payouts are really based on. But hey, Twitter open sourced 'the algorithm' ! Even Elon fans appear to complain and realize that they may have been mislead.

We are definitely witnessing history in the making. A guy, that 4 years ago had a legitimate shot at becoming an absolute legend, decided to push his 'optimism' way too far (for which, I believe, he will end up in prison) and then on a whim, to buy Twitter for $44B, only to burn it to the ground.

Re: X says it is worth $19B, down from $44B last year

#30

Post by guntars »

thghtihadanacct wrote: post #16
kevmo wrote: post #7

$19B seems high.

But $26B seems like a pretty good tax write off. Seriously tho, How much of this drop (adjustment to reality) could Musk potentially write off on taxes, etc? Especially when it was pretty obvious he tanked it on purpose.

Losing actual money is not a good tax write off strategy.
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