Elon Musk reveals in an internal email that X is struggling to break even. Meanwhile, banks are preparing to sell off some of the $13 billion in debt. That They took on to acquire the platform.
X’s financial situation appears to be more precarious than initially expected . In a recent internal communication. Elon musk painted a less than rosy picture for the social media platform he acquired in 2022 for $44 billion .
The tech mogul admitted that the company is “barely breaking even ,” citing several issues including stagnant user growth and revenue he called “negligible . ” The revelations come at a critical time for X, as the banks that financed Musk’s acquisition are now considering selling some of the $13 billion in debt they took on to support the deal. Bank of America, Barclays and Morgan Stanley, among the major institutions involved, are carefully weighing their options to minimize potential losses.
Elon Musk to X Staff: ‘We’re Barely Breaking Even’
X’s financial woes are nothing new, but their scale appears to have become more significant than expected. Musk, in his communication, highlighted X’s “power to shape conversations and actionable outcomes ,” a trait that has not translated into increased user numbers or the financial success hoped for. The platform still faces more than $1 billion in annual interest payments on loans. A significant burden that further weighs on its profitability prospects.
An interesting aspect of the situation is the potential interest of some investors based on Musk’s connection to Donald Trump . With potential buyers who could be attracted by the idea that X’s financials could improve in the future. Taking advantage of the political connection. It remains to be seen whether this speculation will translate into a real financial benefit for the platform. Since Musk’s purchase, X has been in a transformation phase as a sort of test platform for the billionaire’s ambitions in the field of AI .
Musk’s original vision for X was for the service to be “lifetime financial” for users by the end of 2024, but that vision never materialized. That goal still seems a long way off, and despite earlier promises of positive cash flow soon. It appears the path to profitability remains uncertain for the microblogging platform par excellence.https://youtu.be/6LnoyJvAGe0?si=ndiZSW-R2IcWgisr