Elon Musk has had a busy year, and his net worth has suffered.
According to the Bloomberg Billionaires Index, Musk’s net worth has dropped by $9 billion since he purchased Twitter for $44 billion on Thursday, the highest leveraged buyout of a technology company in history. His net worth has dropped by about 25% since the beginning of the year to $203 billion.
Nonetheless, Musk remains the world’s richest individual, outspending runner-up Bernard Arnault by around $65 billion.
In a statement on the day the acquisition was finalized, Twitter’s new owner stated that he “didn’t do it to make more money” but rather to “try to help humanity.” Musk was personally obligated to pay over $25 billion as part of the agreement, while Sequoia Capital and Andreessen Horowitz contributed approximately $7.1 billion in cash. Additional investors raised the remaining funds.
However, Musk now faces various financial hurdles as the owner of Twitter, a firm that has failed to earn a profit in three of the previous five years and has taken on $13 billion in debt as part of the blockbuster transaction. Digital advertising accounts for 90% of Twitter’s revenue and has been declining across the board. Musk stated that the network is considering charging customers $20 to keep the coveted blue check mark of verification on their account.
“We need to pay the bills somehow!” Musk tweeted in an exchange with author Stephen King, who lamented the idea. “Twitter cannot rely entirely on advertisers. How about $8?”
Analysts believe Musk may also order job layoffs across the corporation to minimize money. Twitter spends over $1.2 billion per year on sales and marketing, most of which goes toward staff pay and benefits.
Despite Twitter’s financial difficulties, Musk could conceivably fund the company’s further cash demands on his own. After months of lawsuits, rhetorical mudslinging, and nearly a full-fledged trial, he finalized the agreement last week.
Musk, a self-proclaimed “free speech absolutist,” has stated that if he takes over Twitter, he would relax rules for monitoring damaging content such as disinformation and hate speech. He has also expressed support for reinstating access to former President Donald Trump’s account, which was permanently disabled last year following the fatal Jan. 6 attempted insurgency at the United States Capitol.
Other investors who kept a stake in the firm, like as Twitter co-founder Jack Dorsey and Saudi Prince Alwaleed bin Talal, saw their net worth fall as well. According to Bloomberg’s index, Dorsey lost $380 million and Prince Alwaleed lost $640 million.
Musk’s net worth peaked at $340 billion in November of last year, when shares of Tesla, his electric car firm, skyrocketed owing to good sales. Tesla stock has dropped 43% this year as manufacturing, and delivery metrics fell short of forecasts. Musk also sold about $15.5 billion in Tesla stock to fund the Twitter acquisition, which alarmed investors.
Musk also owns SpaceX and serves on Neuralink and The Boring Company boards. According to Bloomberg’s wealth index, musk’s net worth reduction continues a pattern among top CEOs this year, as 10 of the world’s 11 wealthiest persons have seen their net worth fall since January 1. Meta CEO Mark Zuckerberg’s net worth has dropped the most, down $89.4 billion, as his company’s stock plummets amid disappointing profits. Amazon CEO Jeff Bezos has lost $66.8 billion in value, while Alphabet co-founder Larry Page has lost $40.6 billion in value.