X’s Revenue Has Dropped 40% Since Elon Musk’s Takeover Of The Platform, Lost $456 Million In First Quarter

New documents have illuminated the social media platform X’s financial struggles since Elon Musk‘s acquisition in October 2022. 

The documents also provide insights into Musk’s ambitious plan to transform X into an “everything app,” which includes introducing a payment platform similar to PayPal or Venmo.

X Loses $456 Million

According to the documents, X’s revenue has plummeted nearly 40% in the first six months of 2023, the first full year under Musk’s control. The company brought in $1.48 billion in this period and reported a staggering loss of $456 million in the first quarter alone. This dramatic decline in revenue is primarily attributed to the exodus of advertisers, who once accounted for a significant 90% of X’s revenue.

Musk’s vision for X includes introducing a payment services system named “X Payments.” The company has submitted documents to 11 states to obtain money transmitter licenses, a necessary step to provide financial services on the platform. The plan is to allow users to pay one another, make purchases and even store money within their X accounts.

While X Payments is not intended to charge fees for most of its services, the documents suggest that the primary motivation behind this initiative is to drive “increased participation and engagement” on the social media platform. This aligns with Musk‘s previous comments about his desire for users to be able to open high-yield savings accounts on X.

The then-Twitter incorporated the payments business in February 2022, before Musk’s acquisition. Now rebranded as X Payments, the subsidiary has its own board of directors and management team. However, the documents need to specify whether X will partner with existing payment processors, such as Stripe and Adyen, or banks like Citibank, to provide its X Payments services.

Whatever the losses, Musk can afford it. Tesla shareholders just voted to approve his $56 billion pay package.