Elon Musk’s X in Danger of Bankruptcy: Advertisers Jumping Ship!

The loans that Elon Musk took out to buy Twitter (now X) were about $13 billion, and the social media company has to pay about $1.2 billion in interest annually.

When major advertisers shut down the platform and X can’t pay interest on loans or pay employees, it could actually go bankrupt, the BBC reported on Sunday. “But that would be an extreme scenario that Musk would surely want to avoid,” the report said.

However, for the company he bought for $44 billion, bankruptcy may sound impossible, but “it is possible.” Disney and Apple are no longer advertising on X, and Musk told the companies last week to “Fuck you.”

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

Walmart’s exit adds to a growing list of companies leaving X after Musk endorsed an anti-Semitic message last month (for which he apologized last week). Apple, Disney, IBM, Comcast and Warner Bros. Discovery is one of the companies that no longer buys ads from X.

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

“This ad boycott is killing the company. And the whole world knows that those advertisers killed the company, and we documented it in great detail,” Musk told the audience at The New York Times’ DealBook Summit.

In 2022, Twitter’s advertising revenue was about $4 billion. Insider Intelligence estimates that this year it will drop to $1.9 billion. Following Musk’s outburst against big advertisers, X is reportedly looking to tap into small and medium-sized businesses (SMBs) to offset advertising losses from big companies.

A new report from The Financial Times claims that X is now turning to SMEs for more revenue after Musk angered big brands by endorsing anti-Semitic content.

“SMEs are a very significant engine that we have definitely underplayed for a long time,” a company spokesperson said. “It was always part of the plan, now we’re going even further with it,” the company added.