Twitter shares surge after Tesla chief executive Elon Musk snaps up 9.2% passive stake

The stock price of the social media company jumped about 25% in pre-market trading on Monday

Shares of Twitter surged about 25 per cent on Monday in pre-market trading after Elon Musk, co-founder and chief executive of electric vehicle maker Tesla, acquired a 9.2 per cent passive stake in the social media company.

Mr Musk owns more than 73.4 million shares of Twitter, worth nearly $2.89 billion, a filing with the US Securities and Exchange Commission showed. Twitter has a market value of $31.5bn and its shares are down about 8 per cent since the start of this year and 39 per cent weaker than this time in 2021.

The company’s shares, which settled at $39.3 at the close of trading on Friday, rose to $49.09 Monday morning.

Later in the day he tweeted “Oh hi lol”.

Last month, Bitcoin, Ether and Dogecoin received a brief boost after Mr Musk tweeted that he owns the digital tokens and is not planning to sell.

Mr Musk, the world’s richest person with a net worth of $273bn, according to the Bloomberg Billionaires Index, has recently complained about excessive censorship of content and lack of free speech on Twitter.

“Given that Twitter serves as the de facto public town square, failing to adhere to free speech principles fundamentally undermines democracy. What should be done,” Mr Musk said on Twitter last month.

In response to his poll, 70.4 per cent of users said Twitter does not stick to free speech principles, while 29.6 per cent supported the social media platform.

Mr Musk said he was “giving serious thought to this” in response to a question on Twitter if he is considering building a new social media platform.

Tesla, which dissolved its public relations department in October 2020, relies on social media — largely Twitter — to make new announcements.

Mr Musk, who has more than 80 million followers on Twitter, has made a number of company announcements on the social media platform, including the company’s move to drop the usage of Bitcoin and new features of its cars. Tesla’s own account has over 13.6 million followers.

Tesla, the world’s most valuable electric car maker, reported its largest quarterly net profit between October and December.

The company crossed the $2bn mark in net profit for the first time despite a global semiconductor shortage and supply chain disruptions that have affected the car industry worldwide.

Tesla’s fourth-quarter net profit rose about 760 per cent year on year to more than $2.3bn, almost $700 million more than the income it earned in the same period in 2020.

Tesla delivered a record 310,048 vehicles in the first quarter of this year, despite ongoing supply chain challenges and factory shutdowns. The Texas-based company, which delivered 940,000 vehicles last year, aims to rapidly increase its production and grab a huge market share in 2022.