Musk e-mail warns of ‘severe revenue problems’ at X
In an e-mail to X employees, quoted by The Wall Street Journal, Elon Musk has said that the social network is facing serious revenue problems and stagnant user growth.
Musk admitted: “Our user growth is stagnant, revenue is unimpressive, and we’re barely breaking even.”
When approached for comment Musk insisted he had not sent that e-mail, until direct quotes were posted by The Verge.
Musk bought the social media platform formerly known as Twitter in late 2022 for $44 billion. Since then a number of changes have been made to the platform, such as the introduction of ‘blue tick’ marks for subscribers – a feature once used to denote accounts of public interest.
Musk also restored Donald Trump’s account and campaigned for the Republican candidate in the 2024 US presidential election. The platform’s political shift to the right caused ad revenue to plummet and big spenders like Apple, Disney, IBM, Paramount and 3M, have not returned, nor are they likely to after the New York Times’ DealBook Summit in 2023 where Musk said X would not be “blackmailed”.
According to the Wall Street Journal, seven US banks – including Bank of America, Barclays, and Morgan Stanley – plan to sell some of the $13 billion in loans Musk took out to finance his Twitter purchase at a price of between $0.90 and $0.95 per dollar on the assumption that the financial situation at X is improving. Still, at this stage it’s clear the banks have given up on making money from X in favour of damage limitation.
According to company data cited on website Busines of Apps, Twitter’s revenue peaked in 2022 at $5 billion before tumbling under Musk’s leadership to an expected $2.9 billion.
Figures from Statista for 2024 show X is pulling in 611 million monthly active users worldwide, making it the 12th most used social network, far behind Facebok (3 billion), YouTube (2.5 billion), Instagram and WhatsApp (both 2 billion). Even upstarts like are proving more popular with TikTok (1.58 billion) and Telegram (900 million) proving far more popular.
Musk has built a reputation on buying into companies like SpaceX and Tesla but his X move appears to be a commercial dud. Furthermore it also apears to be a time suck as he posts copiously and has been accused of being one of the primary spreaders of misinformation and disinformation on the site by its built-in AI, Grok.
Musk continued his flirtation with European right wing politics over the weekend. He addressed members of radical German right-wing party Alternative für Deutschland (AfD) on Saturday via video link as it geared up for what promises to be a fiery election campaign.
Between the ravings of its iconic owner and the resulting brand toxicity it’s unlikely X will find a new owner before it can become profitable.
Emerce & TechCentral Reporters
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