Elon Musk's $44B Twitter Bet Not Paying Off? X Bleeding Users Amid Earnings Drought: Report

Elon Musk’s social media venture, X (formerly Twitter), is losing users at an alarming rate a year after the entrepreneur took control of the previous Twitter platform.

What Happened: X has seen a significant decrease in the number of daily active users, according to data from market intelligence firm Sensor Tower, reported by NBC News. In February, the U.S. daily active users dropped to 27 million, an 18% decrease from the previous year. Globally, the number fell to 174 million, a 15% drop from the previous year.

Abe Yousef, a senior insights analyst at Sensor Tower, said that compared to its peers, X had the most significant decline in active users. He attributed this to user frustration over content issues, technical problems, and the rising popularity of short-form video platforms.

See Also: Elon Musk Says Google Infected With ‘Woke Mind Virus’ After Search Engine User Points To ‘Bloodbath’ Definition Change Post-Trump Speech

Despite Musk’s attempts to attract more users to X, the platform’s daily global user count is still less than when Musk acquired it. The platform’s business model has also shifted from mainly ad-supported to offering four subscription tiers. Nevertheless, X’s in-app purchase revenue is a fraction of the advertising revenue it generated as Twitter, according to Sensor Tower.

Why It Matters: X’s problems extend beyond its declining user base. A significant drop in the platform’s ad revenue for 2023, down to $2.5 billion was reported earlier. This decrease underlines advertisers’ unease with X’s content moderation, especially Musk’s posts endorsing extremist views.

Moreover, it was also noted user concerns about X’s financial health despite the platform claiming to be “indispensable” with 250 million daily users and an average of 30 minutes spent per user.

Photo by Angga Budhiyanto on Shutterstock

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