On Wednesday, Reddit co-founderAlexis Ohanian lauded Elon Musk’s grand plans to transform X, formerly Twitter, into the ultimate “everything app.” Now, venerable Wall Street executive and CEO of Farvahar Partners, Omeed Malik, has chimed in with admiration for the billionaire entrepreneur’s efforts.
What Unfolded: During an appearance on CNBC’s Last Call, Malik addressed whether the praise from Ohanian was justified, given reports that the social media platform’s value has plunged to less than half of its purchase price. Malik remarked, “He has resurrected X, or Twitter,” indicating that evaluating X’s value solely based on Fidelity’s metrics might not be the most accurate approach.
Malik referred to Fidelity’s decision to raise X’s value in its fund by 11% in December, despite holding the stake at a 68% discount compared to Musk’s original purchase price, implying a valuation of approximately $14.1 billion.
He emphasized how various companies are utilizing X, citing investments inTucker Carlson and the remarkable traction his videos have garnered on the platform. “When I look at the success Tucker’s had on X, it’s actually mind-blowing and it cannot be discounted,” Malik emphasized.
“Now as we start rolling out advertisements on that platform we double the amount of what people pay $7 million for a minute on the Super Bowl,” Malik stated.
He juxtaposed X’s recent success with its financial struggles under previous management, citing losses of $1 billion and $200 million in the final two years before Musk’s takeover.
Earlier, Ohanian had praised Musk’s efforts to integrate sports betting with BetMGM on X. He said, “Elon Musk told everyone he was going to build “the everything app” and month by month they’ve progressively been shipping the products + partnerships to bring this to fruition.”
Why This is Crucial: Under Musk’s stewardship, X has undergone a dramatic transformation. Acquired for $44 billion in October 2022, X, formerly Twitter, has witnessed substantial changes in content guidelines and staffing, resulting in a notable decline in advertising revenue. Musk aims to pivot X toward paid subscriptions from advertising, but it faced challenges during implementation.