Elon Musk might be touting his social media platform as the “new media” and whatnot but it looks like his company is struggling. In a candid internal email to X staff, Musk revealed that the social media platform is "barely breaking even" amid stagnant user growth and unimpressive revenue.
Musk, who acquired the platform (formerly known as Twitter) for $44 billion in late 2022, expressed concerns about the company's financial health.
According to a report by The Wall Street Journal, Musk told employees that “...we’ve witnessed the power of X in shaping national conversations and outcomes.” However, he also had worrying words for the employees. “Our user growth is stagnant, revenue is unimpressive, and we’re barely breaking even.”
Musk's email, obtained by The Wall Street Journal, highlighted that despite X's influence in shaping national conversations, its financial performance has not met expectations. The platform has faced certain challenges, including a decline in ad revenue and competition from rivals like Bluesky and Threads.
The report also mentioned that banks, including Bank of America, Barclays, and Morgan Stanley, are coordinating to sell portions of the $13 billion debt they provided for Musk's acquisition deal. The financial burden has been exacerbated by over $1 billion in annual interest payments.
Despite Musk's earlier predictions of achieving cash-flow positivity within months, X continues to grapple with substantial financial obligations. The platform has introduced new features such as job listings and a dedicated video section, and introduced GrokAI as well.
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