Elon Musk’s social media network, X (previously Twitter), is now worth less than half of the $44 billion he paid for it in October 2022, according to an internal document. According to the memo and others with knowledge of the situation, restricted stock units that were recently awarded to staff members were valued at $45 a share, indicating that the company is worth approximately $19 billion. Musk has made a number of controversial decisions since assuming control of the platform, including as renaming it X, altering the content guidelines, and terminating over 80% of the staff. Since Musk took over, X’s daily active user count has decreased by around 20%.
According to estimates from Bloomberg, X has lost at least half of its overall revenue from advertising, which has hurt its appeal to sponsors. The company is now concerned about servicing Musk’s debt because of the large decline in sales. According to reports, X owes about $1.2 billion in interest payments on its about $13 billion in total debt. Musk has stated that he would like to see a greater reliance on paid user subscriptions; but, as of right now, less than 1% of all platform users have chosen to pay for a premium membership, which brings in less than $120 million annually.
Under Musk‘s direction, several advantages have surfaced despite the difficulties, such as compensating individual creators for their participation through revenue-sharing payments. In an effort to put truth over sensationalism, Musk recently declared that posts edited by the Community Notes function would no longer be eligible for revenue sharing. Musk has also stated that he intends to turn X into a “everything app,” drawing inspiration from Asian super apps such as WeChat. This would entail adding a range of banking services, video conversations, and other lifestyle use cases to the platform. Additionally, there is optimism that X will eventually incorporate cryptocurrencies.
