Questions linger about the long-term viability of X

04/06/26
Source: Social Media Today – Latest News by Andrew Hutchinson. Read the original article

TL;DR Summary of The Future of X: Viability, Usage, and Funding Challenges Post-Musk Acquisition

X, formerly Twitter, faces significant financial and user engagement challenges since Elon Musk’s acquisition. Despite a steep decline in ad revenue and uncertain active user numbers, the platform remains afloat due to funding linked to Musk’s other ventures like xAI and SpaceX. Meanwhile, competitor platforms such as Meta’s Threads are rapidly gaining users, intensifying pressure on X’s future viability. The platform’s fate is closely tied to Musk’s broader tech ecosystem rather than its standalone profitability.

Optimixed’s Overview: Assessing X’s Longevity Amid Declining Engagement and Strategic Funding

Background and Financial Overview

Since Elon Musk’s 2022 acquisition, X has undergone significant changes aimed at transforming it into an “everything app.” However, this vision remains unrealized, and the platform’s revenue streams have suffered dramatically.

  • Ad Revenue Decline: X’s ad revenue dropped from $4.14 billion in 2022 to $2.26 billion in 2025, reflecting reduced advertiser confidence amid controversies and moderation concerns.
  • Cost Cutting vs. Financial Losses: Despite efforts to reduce expenses, the platform continues to operate at a loss, increasing financial pressure on Musk’s broader portfolio.

User Engagement and Competitive Landscape

User metrics reveal mixed signals, with official reports citing “record high” engagement days but independent data showing a 15% drop in active users in Europe during late 2025. Overall, the user base appears stagnant at best, with 600 million monthly active users reported since 2024 without growth.

  • Unclear User Retention: Increased app downloads have not translated into sustained user growth, suggesting issues with retention or simultaneous user attrition.
  • Competition from Threads: Meta’s Threads has rapidly grown to 400 million monthly active users, positioning itself as a strong contender in the real-time social media space and attracting advertisers.

Strategic Funding and Future Prospects

While X struggles financially, its survival is currently supported by strategic funding through Musk’s other ventures:

  • xAI Merger: The merger with Musk’s AI company xAI provides shared funding and crucial data inputs but is cash-intensive and faces competitive pressures.
  • SpaceX’s Role: The broader partnership with SpaceX, anticipated to go public with a $2 trillion valuation, promises a significant capital influx, indirectly financing X’s continued operation.

Ultimately, X’s viability hinges less on its own profitability and more on Musk’s overall tech ecosystem funding. Should user engagement further decline, it could hamper xAI’s data capabilities and lead to reduced investment in platform improvements.