Elon Musk’s social media platform, X (formerly Twitter), is reportedly in discussions with investors to raise funds at a valuation of $44 billion. It is the same amount Musk paid to acquire the company in 2022. This development, reported by Bloomberg News, marks the first potential investment round since X was taken private.
While the talks are ongoing and details may change, the move has sparked discussions about the platform’s current valuation, especially considering previous financial assessments. It is unclear how X still warrants the same valuation as it did three years ago, with major brands having boycotted the platform in protest of Musk’s takeover.
Strategic overhauls and evolution
Since the acquisition, Musk has implemented a series of strategic changes aimed at transforming X into a multifaceted everything app. This vision led to the rebranding of Twitter to X, accompanied by a visual overhaul that replaced the iconic blue bird logo with a stylised “X.”
The platform also introduced a subscription service, transitioning from Twitter Blue to X Premium, offering users enhanced features and experiences. Additionally, X has expanded its functionalities to include audio and video calling, positioning itself as a comprehensive communication hub.
Integration of AI
In line with Musk’s commitment to technological innovation, X has integrated advanced AI capabilities. The platform’s AI model, known as Grok, is slated for an upgrade to its third iteration, Grok 3. This enhancement aims to improve the chatbot’s interpretative abilities, providing users with more accurate and contextually relevant responses. Furthermore, the Grok chatbot has been made available as a standalone application compatible with both Windows and MacOS, broadening its accessibility and utility for users.
Massive layoffs
Since Elon Musk’s acquisition, X has undergone drastic layoffs, cutting around 80% of its workforce. The reductions aimed to streamline operations and reduce costs but led to concerns about content moderation and platform stability. Despite the cuts, Musk has maintained that X remains operationally efficient, though critics argue the layoffs weakened its ability to handle misinformation and security issues.
More advertisers, but lower ad revenue
Despite the return of major advertisers like Apple, X continues to experience a decline in overall advertising revenue. Data from MediaRadar indicates that X’s U.S. advertising revenue is projected to decrease to $1.4 billion in 2024, a 28% drop from nearly $2 billion in 2023. This decline persists even as the number of companies advertising on the platform has increased by 15% year-over-year. Additionally, Sensor Tower reports that 46 of the top 100 U.S. advertisers on X in January 2025 were new compared to 2022; however, their total spending was lower than in January 2024.
As X continues to navigate the complex landscape of social media and technology, its strategic initiatives and leadership dynamics will play pivotal roles in shaping its trajectory. The ongoing fundraising discussions and the platform’s commitment to innovation underscore its efforts to redefine its market position and deliver enhanced value to its users.
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