Elon Musk says X is ‘barely breaking even’

Elon Musk’s acquisition of X has at all times been controversial. Some individuals find it irresistible, and others hate it. Since his 2022 takeover, the social media app formerly known as Twitter has dramatically modified by way of content material and moderation, and its monetary outlook is reportedly struggling to enhance.

In keeping with the Wall Street Journal, Musk stated in a company-wide electronic mail that “we’ve witnessed the facility of X in shaping nationwide conversations and outcomes,” but in addition that its “consumer development is stagnant, income is unimpressive, and we’re barely breaking even.”

This may increasingly not shock many, on condition that X’s rivals, Bluesky and Threads, have seen rapid growth within the months following the 2024 US election. Final yr, reports indicated that X had misplaced hundreds of thousands of energetic customers within the US.

X has confronted monetary hurdles because the begin

The banks that financed Musk’s acquisition are near promoting off the debt they incurred

X’s poor monetary prospects are nothing new. When Musk first acquired the platform in 2022, he admitted throughout a Q&A session with workers that it was in “a really dire state of affairs from a income standpoint.” The Wall Street Journal additionally studies that the key banks concerned in Musk’s deal to purchase Twitter, equivalent to Financial institution of America, Barclays, and Morgan Stanley, are near promoting a few of the debt they incurred from financing it.

One of many causes the banks have held onto this debt for therefore lengthy is to keep away from promoting it at a big loss and never getting a return on their funding. To dump a few of this debt, the banks should persuade any third-party buyers that X’s monetary future is viable, which is simpler stated than achieved.

X has lately began including new options, equivalent to its AI model Grok, which you should use to ask questions or generate photos. It additionally added new job listings and video tab. In December, X raised the price of its premium subscription service to $22 a month within the US, a considerable 37.5 % improve. No matter occurs, X nonetheless has an uphill monetary battle to face whereas its rivals proceed to develop.

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