Cathie Wood\u2019s ARK Investment Management wrote down its stake in Twitter by 47%, the Wall Street Journal reported on Monday. While the reduction represents a notable change, Wood said it does not reflect her outlook on the long-term viability and success of the platform, which remains bullish.<\/p>\n
ARK Invest, the investment management firm led by Cathie Wood, slashed its stake in Twitter by 47% since the social media platform was acquired by Elon Musk. ARK holds a small stake in Twitter through its venture fund, which makes both public-market and private investments.<\/p>\n
\u201cWe take fair valuation very seriously and absolutely have had to write that [Twitter] down. The write-down is not representative of our fundamental outlook and belief in the long-term return on investment we believe that it will have for our shareholders.\u201d<\/p>\n
\u2013 Wood said. <\/cite><\/p>\n The move comes due to Twitter\u2019s troubled financials, including a substantial debt load and a sharp decline in advertising following Musk\u2019s $44 billion takeover. According to Tesla\u2019s boss, Twitter lost around 50% of advertising revenue and has negative cash flow.<\/p>\n However, although writing down its stake in Twitter suggests ARK is aware of the company\u2019s woes, Wood said she remains bullish on Musk\u2019s social media platform in the long term. For that reason, the stake reduction should not come as a surprise, given that her funds constantly update internal valuations of private companies, she added.<\/p>\n \u201cI would love to get more stock at these price levels actually, but no one wants to let any go. So that tells you something.\u201d<\/p>\n The latest change comes shortly after Meta Platforms launched Threads, a microblogging app seen as a competitor to Twitter. Meta was accused of potentially Twitter\u2019s stealing intellectual property with the launch of Threads, though Mark Zuckerberg\u2019s tech giant fiercely denied the allegations. Since its launch, Threads witnessed over 100 million sign-ups.<\/p>\n Meanwhile, Wood believes that the rollout of Threads could be good for Twitter as it will likely ramp up competition.<\/p>\n \u201cWe think they can coexist. I think Threads has lit the competitive fire or taken it up a notch and it will be good for Twitter. We also think that longer term, Elon and team are very serious that they\u2019re going to turn this into an everything app.\u201d<\/p>\n \u2013 Wood said. <\/cite><\/p>\n Musk has said the buyout of Twitter is a part of his broader plan to build \u201can everything app\u201d that could combine information and entertainment. If it succeeds, it could grow to more than a billion users in five to 10 years, the billionaire believes.<\/p>\n This article originally appeared on The Tokenist<\/i><\/p>\n Sponsored: Tips for Investing<\/b><\/p>\n A financial advisor can help you understand the advantages and disadvantages of investment properties. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.<\/p>\n Investing in real estate can diversify your portfolio. But expanding your horizons may add additional costs. If you’re an investor looking to minimize expenses,\tconsider checking out online brokerages. They often offer low investment fees, helping you maximize your profit.<\/p>\nMeta\u2019s Launch of Threads is Good for Twitter, Wood Says<\/h3>\n