The Evolution of X

In October 2022, Elon Musk acquired Twitter for $44 billion. Sometimes it feels like all anyone has talked about since. As part of the acquisition, Musk raised $13 billion of debt to finance the deal. Since then, it had been hailed as “the worst buyout for banks since the financial crisis.” That is, until this week.

In January 2025, banks that had held onto the Twitter buyout debt since 2022 went out to try and tentatively sell $3 billion of it at a discount. The outcome surprised even them — they ended up selling $5.5 billion at just a 5% discount. Investors are clearly seeing financial viability in X’s future.

How did the worst buyout since the financial crisis manage such a minimal discount? The story is one you might think you’ve heard already, but the details would surprise you. Here’s how Elon Musk managed to turn the money-losing bird app into the latest entry in the Muskonomy.

Step one? Shed some feathers.

In July 2023, Elon Musk rebranded Twitter into X — the everything app. The stated goal of X was to build a single platform across social, financial, and media use cases. A pretty hefty vision.

Step two? Alienate your largest source of revenue.

In November 2023, Musk disbanded the company’s “Influence Council”, a select group of top advertisers on the platform. As advertisers started to express their concerns about spending money on the platform, pushing for content changes, Musk responded in no uncertain terms:

Step three? Emphasize who is really important — users.

Over the course of a few years, X launched more products than Twitter had in the prior decade. Creator subscriptions, revenue sharing with creators, a hiring platform, ecommerce shopping, and a P2P payments wallet.

From the beginning, Elon Musk’s vision for what X was capable of was building out from a core responsibility as the “de facto public town square” to a sweeping vision of becoming the “everything app.”

Despite dozens of high profile departures from X, users voted with their feet. In 2022, when Musk acquired Twitter, it had 368 million MAUs. By January 2025, X had grown to 611 million MAUs. Plenty of the new products on the everything app are nascent, but the vision is clearly compelling to the people who can’t stop using the platform.

Step four? Engage the “Muskonomy.”

Elon Musk has pitched the potential benefits that can come from the synergy between his various companies — Tesla, SpaceX, The Boring Company, Neuralink, X, and xAI. For X, that enabled the further expansion of the company’s product.

Founded in July 2023, xAI launched into the AI race with the intention of “understanding the true nature of the universe.” In November 2023, xAI unveiled its AI model, Grok, that was integrated directly into X and made available to X’s Premium+ subscribers. In December 2024, Grok was offered for free to all X users.

The synergies extended to help X’s financial health as well. In the past, Twitter had been used heavily for AI training data by other companies, often without getting paid for it. In July 2023, after Musk introduced usage limits on processing Twitter data pre-rebrand, he pointed to the need to prevent AI companies from scraping Twitter data for training purposes.

Since then, X has started monetizing access to its data. For example, one report indicated that xAI has paid X “hundreds of millions of dollars” to X for access to training data. This could open up other possibilities for monetizing access to that data from other AI companies.

Step five? Get ready to say “I told you so.”

As X continued to grow users and draw attention, advertisers were unable to stay away. Prominent advertisers, like Comcast, Disney, IBM, and Amazon, started to advertise on the platform again.

Musk’s adversarial relationship with advertisers has been around values, not strategy. But advertising on X isn’t going away. Musk’s key hires at the company have made sure of that. Executives like Linda Yaccarino, Angela Zepeda, and Yale Cohen, respectively former heads of marketing at NBC, Hyundai, and Publicis, have looked to smooth relationships with advertising.

Step six? Tighten up the ship.

Despite an expanded product suite and increased willingness of advertisers to work with X, the clearest picture of X’s reinvention is in its financial picture. Prior to Musk’s acquisition, Twitter had generated $5 billion in revenue and $682 million in EBITDA in 2021. Since, the company has seen revenue decline to $2.7 billion in 2024, but generated $1.3 billion in EBITDA, nearly 2x the profit.

Elon Musk, and X as a platform, continue to attract the ire of a variety of different groups. But the evolution of X from an inconsistently profitable microblogging site to a broader platform is slowly but surely moving its way towards success. From a widespread migration away from the platform to the inevitable bankruptcy, the bear case for X has been proven false time and time again.

But what about the bull case? What if we dream the dream? What could happen if X ends up being a successful experiment? It speaks volumes to what can be done with leaner operations, it demonstrates the power of a platform approach to building product, and it proves that things don’t have to simply stay the same because “that’s how it’s always been.” The products we use, the brands we dedicate our time and attention to — they can evolve and improve.

If there is one takeaway from Twitter’s evolution into X, it is that dreaming the dream can, in some cases, become the reality.

For the full rundown on X’s evolution as a business, you can read our full 10K+ word report here!