Elon Musk says X is ‘barely breaking even’

Elon Musk’s acquisition of X has at all times been controversial. Some folks adore it, and others hate it. Since his 2022 takeover, the social media app formerly known as Twitter has dramatically modified when it comes to 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 e mail that “we’ve witnessed the facility of X in shaping nationwide conversations and outcomes,” but additionally that its “consumer progress is stagnant, income is unimpressive, and we’re barely breaking even.”

This may occasionally 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 12 months, reports indicated that X had misplaced tens of millions 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 reviews that the main banks concerned in Musk’s deal to purchase Twitter, corresponding to Financial institution of America, Barclays, and Morgan Stanley, are near promoting among the debt they incurred from financing it.

One of many causes the banks have held onto this debt for thus lengthy is to keep away from promoting it at a major 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 less complicated stated than performed.

X has lately began including new options, corresponding to its AI model Grok, which you need to use to ask questions or generate pictures. 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 % enhance. No matter occurs, X nonetheless has an uphill monetary battle to face whereas its rivals proceed to develop.

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