Elon Musk helps X turn the tide

Elon Musk will cause many advertising agencies to leave after he takes over Twitter (X) in 2022. Photo: Walaw .

Elon Musk's social media platform X is reportedly worth more than $44 billion , according to a March 19 Financial Times report. The turnaround comes after Musk became a key ally of President Trump.

The company is also currently trying to raise $2 billion in new capital to sell shares to repay more than $1 billion in subordinated debt. Previously, in September 2024, X was valued at only $10 billion by investors at Fidelity Investments.

The reorganization has caused advertisers and users to leave, and at times the app’s value has dropped by as much as 70%. So the question of whether Elon Musk has revived the social media platform remains a hot topic of discussion.

After acquiring Twitter in October 2022, Elon Musk changed the app's name and logo to X and loosened the platform's moderation policies, which caused many advertisers to suspend or withdraw.

At a session at the New York Times DealBook Summit in November 2023, Musk lost control, saying advertisers were trying to blackmail him.

X then sued a global coalition of major advertisers including Unilever, Mars and CVS Health, accusing them of conspiring to boycott the company and causing it to lose revenue. It recently added several brands, including Nestlé, Lego, Pinterest and Shell, to the lawsuit.

Elsewhere, some brands like Amazon have increased their advertising spending recently as Musk’s relationship with Mr. Trump has deepened. According to the Financial Times, investors increased their interest in loans from the platform a week after Mr. Trump won the election in November.

Previously, X CEO Linda Yaccarino had hinted at using Elon Musk’s connections to political power and economic uncertainty to pull advertisers back to the platform. Many advertising agencies have advised clients to increase their marketing on X.

Although the company's profits have fallen significantly, X's earnings before interest, taxes, depreciation and amortization (EBITDA) in 2024 are expected to be $1.2 billion , according to the Financial Times . This figure is believed to be over-adjusted and is virtually unchanged from before Musk took over Twitter.

However, another bright spot that explains the above figure is that interest has increased significantly after Elon Musk offered 25% of his artificial intelligence startup xAI to investors in X.

X owns a $6 billion stake in xAI, and relies on some of the data generated by the artificial intelligence company. According to Business Insider , some investors in X are really only interested in xAI, which is worth $45 billion , and its future potential. At the same time, they do so with the aim of continuing to do business with Elon Musk.

With the above statement, the true value of X is still a big question mark.

An associated bank said the upcoming main round of funding will help X clear its remaining debt. Moving forward, X plans to become a multi-functional app with the launch of its X Money e-wallet later this year, with Visa as its first partner.

X is also working closely with xAI to integrate its AI technology into the platform to improve its advertising services and products. xAI recently launched the latest version of its AI chatbot Grok 3 for premium subscribers.