Social media platform X, previously known as Twitter, has experienced a dramatic resurgence in value, now being valued at a staggering $44 billion. This sharp turnaround highlights a significant shift in the company’s fortunes since Elon Musk took control of the platform in 2022, following his high-profile acquisition of Twitter for the same price tag of $44 billion.
The new valuation comes after a secondary deal earlier this month, where investors exchanged their existing stakes in the company, according to sources familiar with the matter. In addition to this, X is reportedly in the process of raising fresh capital in a primary round, aiming to raise about $2 billion by selling new equity. This new funding will be used to pay off more than $1 billion in junior debt, which Musk had agreed to take on to finance the original buyout.
The remarkable comeback contrasts with the platform’s struggles in the immediate aftermath of Musk’s takeover, during which his loosening of content moderation policies led to a mass exodus of advertisers. By late September 2024, some disclosures from Fidelity Investments had suggested a valuation of less than $10 billion, a sharp decline from Musk’s original purchase price.
However, the new valuation of $44 billion signals a positive turn for Musk and X’s investors, including prominent firms like Andreessen Horowitz, Sequoia Capital, 8VC, Goanna Capital, and Fidelity Investments. This deal sets the stage for the primary funding round, allowing X to solidify its financial footing.
While X’s revenue has decreased since Musk’s acquisition, reports suggest that the platform is on a path to recovery. According to sources, X is expected to post approximately $1.2 billion in adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) in 2024, consistent with pre-acquisition levels. Some experts suggest that Musk’s aggressive cost-cutting strategy is beginning to yield results, though there are also claims that the EBITDA figure has been heavily adjusted.
The company has declined to comment on the current financial details. However, a group of seven Wall Street banks, including Morgan Stanley, Bank of America, Barclays, and MUFG, who had initially been burdened with the $12.5 billion in loans Musk used for the acquisition, have now sold almost all of those loans. The improvement in investor interest, particularly after the election of former President Donald Trump in November, has helped stabilize X’s financial outlook.
Investor confidence in X has been further bolstered by Musk’s growing relationship with Trump, with the billionaire becoming a close ally to the president and taking on a leadership role in the “Department of Government Efficiency” (Doge), a government initiative aimed at reducing regulatory burdens. Moreover, Musk’s decision to grant a 25% stake in his AI company, xAI, to X investors has provided new security for X’s lenders and contributed to the platform’s enhanced valuation.
X’s fortunes have also been helped by an uptick in marketing spending from major companies like Amazon, as well as new partnerships with brands such as Nestlé, Lego, Pinterest, and Shell. Musk recently filed a lawsuit against these companies, accusing them of boycotting the platform in violation of antitrust laws.
Beyond advertising, X is expanding its revenue streams. In January, CEO Linda Yaccarino announced the forthcoming launch of X Money, a digital wallet and peer-to-peer payment service, in collaboration with Visa. Musk has also outlined ambitious plans for X to become a multi-faceted “everything app.” The platform is integrating artificial intelligence technology developed by xAI, including the recently launched AI chatbot Grok 3, which is now available to premium subscribers. This technology is expected to play a key role in enhancing X’s advertising and product offerings.
