(crowd cheer)
- [Crowd Member] Elon, Elon.
- [Narrator] Elon Musk, at $330 billion,
was the richest man in the world.
But then.
- [News Reader] Tesla stock has plummeted more
than 65% since the start of 2022.
- He's no longer the world's richest man
and his EV company is on track
for having its worst year in the stocks history.
- [Narrator] By the end of 2022,
Musk lost more than half his net worth on paper.
- On any given day, he could be the world's richest man
or he could be the world's second richest man,
or he might fall because the share value of Tesla falls.
- [Narrator] Most of Musk's wealth is tied up
in shares of his businesses.
That means volatility in his company's stock
and valuations can directly sway his net worth.
(crowd chatter) - When I think about Tesla.
- In the last few months,
Musk has recovered some lost ground.
His net worth, according to the Bloomberg Billionaire Index
is now estimated at about $160 billion.
But the trajectory
of his key businesses has some investors concerned.
Here's how a volatile stretch for some
of his companies is impacting Musk's net worth.
- Elon Musk's wealth really ballooned during the pandemic.
But in the past year or so,
we've seen it go on a wild rollercoaster.
- [Narrator] The Wall Street Journal reached out
to Elon Musk for comment, but he did not respond.
- Since he took over Twitter, roughly six months ago,
there's been lots of questions
about his overall management style and wondering if,
perhaps, some of the magic has been rubbed off.
- [Narrator] Musk is a serial entrepreneur.
He made $22 million selling his first startup in 1999,
an internet business called Zip2,
then bet most of that money on a startup, PayPal.
When eBay bought PayPal, he made $165 million
and used that to found SpaceX
and become an early investor in Tesla.
He bought Twitter in October, 2022 for $44 billion,
funding some of the purchase
by selling $39 billion worth of his Tesla shares.
It's been a rocky few months since his takeover.
- Twitter's never been a company that's made a lot of money,
oftentimes being unprofitable on an annual basis,
but he takes control and immediately he says he needed
to start making dramatic changes.
- [Narrator] Soon after the purchase,
Musk fired top executives, laid off thousands of employees
and said advertisers cutting ad spending have led
to a massive drop in revenue.
- He thinks he's, in essence, right size to ship,
but now it's a private company,
so we don't know exactly what's going on in there.
- [Narrator] Musk's ambitions for Twitter are a mix
of content, communication, and commerce,
similar to popular Chinese social media platform, WeChat.
All this, Musk says, will help turn Twitter
into a company worth $250 billion.
But for now, Twitter is valued around $20 billion
- And I remember $20 billion is dramatically less
than what he acquired the company for
and the deal that was around $44 billion.
So just imagine his wealth going like this
and it's just been a wild ride to watch.
- [Narrator] Elon Musk's main source of wealth is Tesla.
As of late April, 2023, Tesla was worth about $500 billion
and Musk owns about 13% of the company.
Tesla grew significantly in 2020,
up to a peak value of $1.2 trillion in 2021.
But it fell significantly last year,
down to around $390 billion.
And all that fluctuation
has affected Musk's personal wealth.
While Tesla's stock has rebounded slightly in 2023,
investors have a few concerns.
The amount of time Musk spends focused on Twitter
and Tesla's price cuts that have reduced profit margins
on each car it sells.
- Well, Tesla is profitable,
and it's projecting a dramatic growth into the future.
The question is how dramatic and how profitable.
- [Narrator] Musk also envisions a future
where Teslas continue making money for the company
after someone initially purchases the car.
For example, charging for software updates.
- And that's a big bet.
That's like, in a lot of ways,
an industry upending business model.
Tesla has not yet shown the ability
to deploy fully autonomous vehicle technology
and so he's essentially telling the world,
"This is coming, and we're gonna make a lot of money
down the road", and Wall Street's not so sure about that.
- [Narrator] And then there's SpaceX.
Musk founded the company in 2002
with money he got from selling his stake in PayPal.
And while SpaceX doesn't release financials,
last year the company was valued at around $140 billion.
As of 2022, a trust associated with Elon Musk
owned 42% of the company.
SpaceX executives recently said it's making money
off of its Falcon 9 rockets and Dragon Spacecraft.
And executives expect Starlink, a SpaceX division
that provides high speed broadband internet
with satellites to begin making money this year too.
- Tesla is where the bulk of his wealth is at this point,
but SpaceX is increasingly looking like
it's going to be a juggernaut onto its own
and might be where the next tranche
of huge valuation comes from.
- [Narrator] Musk also owns three other companies,
Neurolink, Boring Company, and X.AI.
They're all privately held, and their finances are unclear.
- They're their early stages.
The bulk of Elon Musk's time at this point
is in three places, Tesla, SpaceX, and now Twitter.
These other startups are of interest to him,
but he would even say that they are far down
on the list of priorities in any given day.
- [Narrator] Musk's wealth has traditionally been tied up
in his businesses and he's been labeled
as a cash poor billionaire because he has to borrow
against his shares for living expenses.
- One of the things about Elon is he's become richer
and richer is that it gives him the wherewithal
and the ability to chase these big ideas that he has.
Whether it's trying to make humanity
a multi-planetary species, or make electric cars cool,
or buy that shiny object that he now has, which is Twitter.
A stumble now could change his legacy,
could perhaps overshadow his past accomplishments,
yet he's still showing a huge appetite for risk.
(bright music)
(crowd cheer)