X could go bankrupt under Elon Musk if THIS happens; Here are the details you need to know

California: Elon Musk’s acquisition of Twitter, now known as

X could go bankrupt under Elon Musk if THIS happens; Here are the details you need to know (Image: IANS)

California: Elon Musk’s acquisition of Twitter, now known as X, was financed with $13 billion in loans, resulting in annual interest payments of about $1.2 billion. But now the company’s financial situation is dire, as major advertisers leave the platform and revenues decline. This raises concerns about X’s ability to meet its debt obligations and pay employees, potentially leading to bankruptcy. Although this scenario is considered extreme, it highlights the precarious financial condition of X under Musk’s leadership, according to a report by news agency ANI.

However, for a company he bought for $44 billion, bankruptcy may sound unthinkable, but “it is possible.” Disney and Apple no longer advertise on X and Musk last week told companies to ‘Go f*** own’.

Retail giant Walmart refuses to advertise

Retail giant Walmart has confirmed it does not advertise on X. “We do not advertise on X as we have found other platforms to better reach our customers,” a Walmart spokesperson said in reports.

Walmart’s departure adds to the growing list of companies leaving X after Musk endorsed an anti-Semitic post last month (for which he apologized last week). Apple, Disney, IBM, Comcast and Warner Bros. Discovery are among the companies that no longer buy ads on X.

Percentage of X’s revenue from advertising

Last year, about 90 percent of X’s revenue came from advertising. Not anymore. Musk has warned that the loss of major advertisers would mean the end of X. “If the company fails, it will fail because of an advertiser boycott. And that will mean the bankruptcy of the company,” he said.

“What this advertising boycott is going to do is kill the company. And the whole world will know that those advertisers killed the company, and we will document it in detail,” Musk told the audience at The New York Times DealBook Summit.

Twitter’s advertising revenue

In 2022, Twitter’s advertising revenue was approximately $4 billion. Insider Intelligence estimates that this amount will drop to $1.9 billion this year. Following Musk’s outburst against major advertisers,

It has been claimed that X will now turn to SMEs to boost revenues after Musk angered major brands by supporting anti-Semitic content, according to a report from the Financial Express.

“Small and medium-sized businesses are a very important driver that we have neglected for a long time,” said a company spokesperson. “It was always part of the plan; now we are taking it even further,” the company added.

(With input from agencies)