The world’s richest man, Elon Musk, is now Twitter’s largest shareholder after acquiring a 9.2% stake in the social media platform for just under US$3 billion (£2.3 billion). The announcement drove Twitter’s share price up 27%, and it continued to grow in after-hours trading.
This investor enthusiasm is not surprising. Social media platforms have been suffering lately thanks to newly developed pressures in their ecosystems. For example, Twitter, and also Meta, have been on the receiving end of Apple’s anti user-tracking system. This is costing them billions of dollars in lost revenues, causing both companies’ stock to languish for the past few months.
Musk’s arrival as Twitter’s largest shareholder will probably not make a difference to that issue, but it does address two other recent investor concerns. Firstly, Musk had been threatening to create a competing social media network where “freedom of speech” ideals would be adhered to. The threat of a new popular entrant being created by a visionary tech leader now goes away. It also shows that Musk is coming in with a vision to drive change in the ecosystem, which is something not to be taken lightly.
