Musk's X rebounds to £36 billion amid Trump alliance boon
The social platform X (formerly Twitter) has reached a valuation of £36 billion, a return to the value at which Elon Musk acquired the service in 2022. The FT emphasises that this change comes at a time when the platform's owner has become a close ally of President Donald Trump.
According to unofficial reports accessed by the Financial Times, investors value platform X at £36 billion. This valuation occurred in early March when existing shares in the company were exchanged. This is excellent news for Elon Musk. As recently as September of last year, documents from Fidelity Investments suggested that the company's value had fallen below £8 billion.
X is also working on raising fresh capital in a funding round to secure approximately £1.6 billion by selling new shares. These funds are intended to repay more than £840 million in subordinated debt that Musk agreed to incur to finance the takeover of Twitter in 2022.
Change in business strategy and collaboration with xAI
After acquiring the group, Musk relaxed the content moderation policy on the platform, leading to many advertisers' departure. Nevertheless, according to two people familiar with the matter, the company showed approximately £970 million in adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) in 2024. This would be a value close to the period before Musk's acquisition. It should be noted that one person familiar with the documentation described the EBITDA as "heavily adjusted."
Two other people familiar with X's finances suggested that there are signs that Musk's cost-cutting plan is yielding results, and revenues are improving.
Investor interest increased following Trump's election victory in November due to the billionaire's close relationship with the new administration. Musk advises the president and leads the Department of Government Efficiency (Doge), which aims to reduce bureaucracy and daily reports to the British economy.
Musk's plans to transfer a 25% stake in his AI-related startup, xAI, to "community" investors may also have influenced the value of X. Meanwhile, Grok 3, a company tool, is gaining popularity.
New revenue sources and the return of advertisers
A group of seven Wall Street banks, including Morgan Stanley, Bank of America, Barclays, and MUFG, sold nearly all of the £10.2 billion in loans Musk used to finance the acquisition of Twitter in 2022. The banks agreed to give the company time to secure fresh capital or alternative financing to repay the remaining debt.
Musk can also count on greater engagement from companies. Recently, giants like Amazon have increased marketing spending on the platform, providing additional support for X.
