Twitter CEO Elon Musk just wrote an internal memo to his staff in which he valued the social media company at around $20 billion. This is a significant decrease from Musk’s Twitter buyout payment, which valued the company at $44 billion. In addition, Musk announced stock grants at the same valuation.
In addition to announcing the $20 billion valuation, Musk also made stock grants to employees in his memo, reportedly based on the same valuation.
The $20 billion valuation surprised employees and customers of Twitter because it indicated a double decrease in value. Especially because the company’s chief executive officer asserts that he has brought it back to a much more stable state and put it on track to reach cash flow break-even in 2023.
The social media company that specializes in microblogging has been able to improve its cash flow by significantly cutting costs and developing faster revenue streams.
Just in the wake of venturing into the organization, Chief Elon Musk cut costs by slicing down over half of its all-out labor force, with work slices and new cutback adjustments going on into 2023.
The company was able to maintain costs by eliminating numerous offices that were accounting for a significant portion of its expenses thanks to this massive layoff.
Musk also introduced newer revenue-generating strategies for the business, including the introduction of a paid Twitter blue tick and the revival of political advertising on the platform, in addition to terminating employees.
The European Union contacted Musk to hire additional human moderators in response to widespread layoffs of its moderators. Now, Musk doesn’t want this for Twitter because, while Musk wants to automate Twitter’s content regulation process, making this choice will significantly raise the platform’s costs.