Elon Musk temporarily earned the title of world’s second-richest person.
The 0 and Twitter temporarily lost his crown on Wednesday, 14 months after first ousting Jeff Bezos as the richest man in the world. However, he is not to blame; it is not Bezos.
On December 7, at 3:30 p.m. ET, Bernard Arnault once more surpassed Elon Musk to take the title of richest person in the world. Musk, who was worth $184.6 billion, was assessed to be worth $100 million less than him, making him worth $184.7 billion. With an estimated net worth of $185.4 billion, or $700 million more than Arnault, Musk had reclaimed the lead when U.S. markets closed at 4 p.m. ET. The shifting of the ranks will be updated by Forbes in the future.
Elon Musk became the world’s richest person for the first time on September 27, 2021, surpassing Jeff Bezos of Amazon. When contacted that day for reaction, the Tesla CEO emailed Forbes, “I’m sending a gigantic statue of the digit ‘2’ to Jeffrey B., complete with a silver medal.” Musk was once again the legitimate owner of the runner-up trophy as of 10:50 AM EST on Wednesday, fourteen months after initially winning it. However, he is not to blame; it is not Bezos.
For a brief period late on Wednesday morning, Bernard Arnault of the French luxury goods group LVMH held the title of wealthiest person in the world. With a net worth of $185.4 billion, Arnault topped Forbes’ list of the world’s wealthiest people in 2021 after briefly switching places with No. 3 Bezos (Musk was worth $185.3 billion at the time, and the pair have alternated positions ever since).
Musk took over first place again around 12:30 EST. Given that the two men’s net worths are only $200 million apart, it won’t be shocking if they continue to fluctuate in Forbes’ lists of the world’s richest people.
As shares of his luxury company edged higher on Wednesday morning, Arnault’s net worth increased by a few hundred million dollars. Arnault, however, owes his regained position as the richest person in the world primarily to the significant decline in the price of Tesla’s stock given that LVMH’s stock has been unchanged this year. Following the announcement of a sizable order from the electric vehicle manufacturer, car rental giant Hertz, the Tesla CEO’s net worth, which peaked at $320 billion in November 2021, was reduced.
The business to which Musk owes the majority of his money has had a tumultuous year. But the stock has had a terrible performance. For the year, Tesla stock has decreased by close to 50%. That represents a decline of almost 20 percentage points from the Nasdaq’s overall tech-heavy average. Due to his stock and option holdings, Musk owns nearly 25% of Tesla, but his current value is 43% lower than it was in November 2021.
Tesla’s performance has been hindered by supply chain challenges, mainly as a result of China’s zero-Covid policy, since since it posted record revenue and earnings in the first quarter of 2022, unlocking options for Musk at the time valued $23 billion. In the second quarter, deliveries fell for the first time in two years. Despite exceeding analysts’ adjusted earnings per share forecasts in Q2 and Q3, the firm experienced revenue shortfalls in both quarters. However, the company’s stock price has declined by over half since Musk’s $44 billion acquisition of Twitter was first revealed on April 14. This is largely attributable to Musk’s acquisition of Twitter.
Musk likely sold shares of Tesla worth $19.3 billion (pre-tax) between mid-April and early November to pay for the acquisition, which caused the electric vehicle manufacturer’s stock to decline. Additionally, it has come to light that Tesla investors’ concerns that Musk would be distracted by Twitter were well-founded. Musk spent nearly half a year trying to get out of the Twitter acquisition due to falling tech equities, but was finally compelled to do so in late October. Since then, he has taken on the role of micromanaging CEO, making a series of fast platform modifications that drew immediate criticism from both users and advertisers. The two biggest ones are raising the cost of account verification to $8 per month and reducing Twitter’s content moderation.
Even if Twitter is probably worth far less now than the $44 billion Musk agreed to pay for it in April, the purchase itself hasn’t yet significantly reduced his wealth. Musk managed to get $8.1 billion in stock commitments from a group of investors that included Twitter cofounder and former CEO Jack Dorsey after purchasing roughly 9% of the business at a discount on the public market before being late in disclosing his plans. Then, in order to finance his alleged 82% share and keep it off his personal balance sheet, he racked up $13 billion in debt for the company.
These actions have mostly compensated for Twitter’s estimated 40% value decrease since April. But on Wednesday, it wasn’t enough to stop Arnault. Another worry is whether the Frenchman will be able to maintain his position at the top.