Hey everybody, welcome back to the Elon Musk Podcast.
This is a show where we discuss the critical Crossroads, The
Shape, SpaceX, Tesla X, The Boring Company, and Neuralink.
And I'm your host, Will Walden. Investment firm Fidelity has
adjusted its valuation of shares in X Holdings, which is a
company previously recognized as Twitter.
Now, this adjustment comes as part of the mutual fund giant's
ongoing assessment of its investment, originally made when
Elon Musk acquired the company for $44 billion.
Fidelity's recent disclosure, which includes data up to the
end of November 23, reveals a significant markdown in the
value of X Holdings and the mutual fund company now assesses
X Holdings to be worth 71.5% less than its value at the time
of purchase. This revelation includes a 10.7%
reduction during November alone. This markdown period coincided
with a controversial moment from Elon Musk, the head of X
Holdings. In November during an on stage
interview with the New York Times, Musk responded to
boycotting X advertisers with the expletive laden remark Go F
yourself. The statement possibly impacted
the perception and the value of the company now comparing to
other companies in the sector. Meta's stock rose by 4.9% in
November, while Snap experienced an impressive 38.2% increase in
their shares. These figures highlight the
differing fortunes of companies within the tech industry and
provide a contrast to the situation at X.
Now, looking back, Fidelity started marking down its
investment in the company immediately after Musk's
takeover. However, it's notable that there
were periods early in 2023 when Fidelity either increased the
value of these shares or maintain their stability.
Now this indicates fluctuations in the company's perceived
worth. It's important to note that
Fidelity, despite being a shareholder and the privately
held X Holdings, may not have extensive insider information
about the company's financial performance.
This means that their valuation could be based on very limited
data and other stair holders might have different views on
the worth of the stock now. X Holdings, in a move that
caught media attention, briefly reinstated headlines recently
too. And this is for user posts
containing links. This happened on Tuesday of this
week, only to reverse this change the following day.
This fluctuation in the platform's features reflects
ongoing adjustments under the new ownership of Elon Musk.
Things happen at X really fast. Move fast and break stuff, as
they used to say in Silicon Valley.
Now this alteration came, and after X had initially removed
news, links and headlines from post in October following Musk's
assertion that such changes would enhance the platform's
aesthetics. The removal, however, required
users to click on an image to view the title, leading to some
confusion and criticism. Musk had promised in late
November that headlines would be reintegrated into the platform
in an upcoming release, suggesting they would be
overlaid on the image or the URL card.
And now this change aimed to address user concerns about the
accessibility and the clarity of linked content.
Indeed, posts on X with links now feature headlines, though
presented differently than before.
The temporary change on Tuesday showed headlines in small text
at the bottom of the image of a URL card, specifically on the
desktop version of the platform. However, this update did not
extend to all versions of the app.
The change was not implemented in the iOS app and the Android
app. Headlines continue to appear
under the image as they did before the removal, highlighting
inconsistencies in the platform's user experience
across different devices. Some users on the web version of
X are now seeing headlines and website titles appearing over
the images that link to those pages.
This changed. While a positive, development is
not without its issues, such as truncated headlines and very
hard to read small text. The initial decision to remove
headlines was driven by Musk's desire to streamline the
appearance of posts. However, this led to
difficulties in understanding where a link image would
redirect users, prompting workarounds like embedding
headlines and images or post text.
And Musk's promise to reinstate headlines over URL cards is
gradually coming to fruition. As evidenced by these recent
changes, however, the rollout of this feature is inconsistent,
particularly on Android and iOS, and the valuation and
functionality changes that X Holdings reflect the complex and
often unpredictable nature of the tech industry and social
media. Fidelity's markdown of X shares,
coupled with the platform's evolving interface shows that
there are challenges faced when you take over a company, a
legacy company like Twitter. The situation at X Holdings is a
microcosm of the larger tech industry as well, where
innovation, public perception and market dynamics interplay to
shape the fortunes of companies. And as X continues to adjust,
Musk's leadership, its impact on the sector and the stakeholders
and the money people remains a subject of keen interest.
Now, Fidelity's decision to reduce the valuation of its
shares in X Holding in conjunction with the company's
ongoing adjustments to this platform shows that it's often
volatile at Twitter, formerly Twitter X.
But X will continue to adapt strategies, have responsive
leadership and navigate the complexities of a new platform.
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