News

Elon Musk Loses World's Richest Human Title

Tesla shares have dropped by more than half this year, diminishing Musk's net worth

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Published December 13, 2022

Elon Musk shrugging while giving two thumbs up on a red carpet. — Getty / Britta Pederson

The world has a new wealthiest human.

Elon Musk lost his top rank to LVMH CEO Bernard Arnault after Tesla Inc. (TSLA) stock fell 6% on Monday, bringing its decline this year to about 50% amid Musk's highly public purchase of Twitter. Forbes estimates Musk's net worth at $177.8 billion and Arnault's at $188.1 billion.

Key Takeaways

Tesla CEO and Twitter owner Elon Musk is no longer the world's wealthiest person, according to Forbes' rankings.
Musk's net worth has fallen alongside Tesla stock, which is down more than 50% in the last year.
Tesla has been hurt by dwindling consumer demand in China, supply chain snares, inflation, and concerns about Musk's purchase of and involvement with Twitter.
Musk has sold at least $19 billion in Tesla stock in recent months as he worked to finance the Twitter acquisition.

Tesla stock is trading at 30 times forward earnings, the lowest ever. The company faces challenges including slowing demand in China, the world's largest car market, as well as inflation and supply chain concerns.

Musk's protracted negotiations and eventual purchase of Twitter for $44 billion in late October have weighed on Tesla shares. Between April and November, the CEO sold more than $19 billion of Tesla stock, where most of his wealth is tied up, as he rearranged positions and lined up additional investors to finance the purchase of the social media giant. Tesla shareholders have viewed Musk's focus on Twitter as potentially distracting from his leadership at the carmaker.

Bloomberg, whose Bloomberg Billionaires Index competes with Forbes' ranking, also reported Tuesday that Musk had lost his title as the world's richest person. Bloomberg News, which employs different data than Forbes, sees a tighter race between the world's two richest men, estimating Musk's wealth to be $168.5 billion compared with Arnault's $172.9 billion.

Musk's net worth may soon get a boost from his ownership stake in SpaceX, which is said to be offering to sell insider shares at a price that would value the company at $140 billion, according to a Bloomberg report. Bloomberg's estimation of Musk's wealth relies on a $125 billion valuation of SpaceX. If the company sells its shares sell at its desired price, Musk's 44% stake in the company could be worth more than the current estimate of $47 billion.

Article Sources

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Forbes. "Real Time Billionaires."
CNBC. "Elon Musk is no longer the richest person in the world."
Bloomberg. "Tesla Stock Has Never Been This Cheap — And It Could Still Drop Further."
Fortune. "Elon Musk dumps $4 billion of Tesla shares as he looks to fund Twitter purchase."
CNBC. "The concern among Tesla investors is that Musk is distracted with Twitter, says WSJ’s Higgins."
Bloomberg News. "Elon Musk Is No Longer the World's Richest Person."
Bloomberg News. "SpaceX Tender Offer Is Said to Value Company at $140 Billion."
Bloomberg Billionaires Index. "Elon Musk."

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