Image Source: Jeremy Bezanger on Unsplash
Since Elon Musk announced last month that he had purchased a 9% interest in Twitter, the stock has lost all of its gains.
On Monday, the stock fell 7% to $37.80, closing below the $39.31 closing price on April 1, the last trading session before Musk declared his minority stake in Twitter. Investors have been selling the stock because they believe Musk will back out of his agreement to buy Twitter for $44 billion, or $54.20 per share, that he announced in late April.
After Musk tweeted on Friday that the deal is on hold until he learns more about phony accounts and how ubiquitous they are on the platform, the stock’s slide accelerated. He later stated that he’s “still committed to acquisition,” prompting Twitter Chairman Bret Taylor to remark, “We’re committed to acquisition as well.”
Musk, the billionaire CEO of Tesla and SpaceX, raised more concerns over the weekend as he continued to post about Twitter’s algorithm and other “possible faults in the code.”
Twitter stated on Thursday that it would halt hiring, cancel job offers, and slash costs. Two other executives left the company, including Kayvon Beykpour, the company’s head of consumer products, who said he was asked to go by CEO Parag Agrawal.
Agrawal said Friday that he still expects the sale to Musk to go through, but that he’s prepared to continue “leading and operating Twitter” in case it doesn’t.
In a series of tweets on Monday, Agrawal outlined how Twitter combats spam and determines what percentage of accounts are fake on the platform, noting that the company can’t publicly disclose specific details of the process because it relies in part on private user information.
“We shared an overview of the estimation process with Elon a week ago and look forward to continuing the conversation with him, and all of you,” Agrawal wrote.
Musk replied to Agrawal’s tweet, saying: “So how do advertisers know what they’re getting for their money? This is fundamental to the financial health of Twitter.”
He replied to another of Agrawal’s tweets with a smiling poop emoji.
With the continued slide in the stock, Twitter is now valued at a little over $29 billion, or roughly $15 billion below Musk’s agreed upon purchase price.