Elon Musk’s $44 Billion Gamble on X Might Finally Pay Off

Elon Musk’s $44 billion acquisition of X (formerly Twitter) seemed like a financial disaster, but the platform may be regaining its value. Reports suggest X is in talks to raise funds at a $44 billion valuation. Major advertisers like Apple and Amazon are returning after previously pulling out due to concerns over extremist content. X’s stake in Musk’s AI company, xAI, may also be boosting investor confidence. Musk’s role in the Trump administration has made X politically influential. His cost-cutting measures have improved financial stability. However, X still struggles with competition and technical issues. Whether this rebound is sustainable remains uncertain.

Elon Musk’s $44 Billion Gamble on X Might Finally Pay Off

Elon Musk may be on the verge of accomplishing what once seemed impossible: restoring the value of his $44 billion investment in X, formerly known as Twitter.

Since acquiring the platform in October 2022 for what many considered an inflated price, Musk implemented drastic changes that led to turmoil, causing advertisers to flee and the company’s valuation to plummet. However, recent developments suggest a turnaround. According to Bloomberg, X is in discussions to raise funds that could place its valuation back at $44 billion, though the deal is not yet certain.

A key factor in this recovery appears to be the return of major advertisers like Apple and Amazon, who had previously distanced themselves from X due to concerns over hate speech and extremist content. Additionally, reports indicate that bondholders have been able to offload X-related debt at near-face value, signaling renewed confidence in the company’s financial health.

X’s potential stake in Musk’s artificial intelligence company, xAI—reportedly seeking a $75 billion valuation—may also be contributing to its resurgence. However, the primary driver behind this turnaround is likely Musk himself.

His close association with the Trump administration, where he now holds a special government advisory role, has made X an essential platform for political discourse. As a result, investors appear to be betting on Musk’s influence rather than X’s financial performance—similar to the valuation of Trump’s media company, Truth Social, which remains high despite generating minimal revenue.

Musk’s control of X has led to a series of controversial decisions, including massive layoffs, reinstating previously banned accounts, altering the verification system, and openly clashing with advertisers. Despite these moves, X has maintained its relevance, particularly in the political landscape.

While Musk once envisioned transforming X into an “everything app” akin to WeChat, progress toward that goal has been slow. Although the platform recently partnered with Visa to offer digital wallet services, ongoing technical issues and competition from rival platforms pose significant challenges.

Nevertheless, Musk’s aggressive cost-cutting measures may have improved X’s financial standing, and the return of advertisers could further stabilize the business. Whether X can sustain this resurgence remains uncertain, but for now, Musk has managed to salvage what many had written off as a failing investment.

In October 2022, Elon Musk acquired Twitter for $44 billion, a price widely considered excessive. His drastic changes led to turmoil, causing a sharp decline in advertising revenue and company valuation. However, after two and a half years, X—formerly Twitter—appears to be regaining its worth.

According to Bloomberg, X is in discussions to raise funds at a valuation of $44 billion. Though the negotiations are ongoing and may not materialize, the report aligns with a positive shift for the platform. Major advertisers, including Apple and Amazon, are returning after previously distancing themselves due to concerns over hate speech and extremist content. Additionally, bondholders recently managed to offload X-related debt at nearly full value, signaling renewed investor confidence.

A significant factor in X’s recovery is its stake in xAI, Musk’s artificial intelligence company, which is seeking a $75 billion valuation. However, the most crucial element behind X’s resurgence is Musk himself.

With Donald Trump’s return to the White House, Musk’s role in the administration has enhanced X’s political relevance. The platform, which has been heavily used to amplify Trump’s messages, has once again become a key space for political discourse. Investors now view X as a strategic asset in the current political landscape, similar to how Trump’s social media company, despite low revenue, commands a high market valuation.

X’s turnaround is remarkable, given that Fidelity valued the company at just 20% of its original purchase price in late 2024. Musk’s sweeping cost-cutting measures, including mass layoffs and policy changes, drastically reshaped the platform. While these moves alienated advertisers, X is now making efforts to regain their trust.

Despite its resurgence, X still faces challenges. Musk’s vision of transforming it into an “everything app” akin to WeChat has yet to be fully realized. The platform continues to struggle with technical glitches, competition from newer alternatives, and reputational risks associated with its content policies. While recent improvements signal progress, the long-term sustainability of X’s comeback remains uncertain.