Jack Dorsey, Noah Glass, Biz Stone, and Evan Williams launched Twitter in 2006. Based out of San Francisco, California, Twitter operates as a microblogging platform and social network, allowing users to post and interact with 280-character messages known as tweets.
As Twitter became a public company in November 2013 at an estimated valuation of $14 billion, its social network has expanded into an influential global platform with over 540 million monthly active users as of July 2023. In November 2022, Elon Musk delisted Twitter and bought back all the shares from shareholders. The company is private and controlled by Elon Musk’s X holdings. Twitter also was rebranded to X Corp.
X corp. generates most of its revenues through the sale of advertising services, the sale of data licensing and other services, and the recently incorporated Blue subscription. In 2023, Musk estimates 3 billion in total revenue, down from 5.1 billion in 2021. Twitter lost about 50 percent of its ad revenue and suffers from a heavy debt load. Since X generated most of its revenue (90%) through advertising services in 2022, Musk and his team are searching for other revenue streams.
While establishing itself as an essential global social media player, X still faces pressure to improve profitability and fully monetize its platform – finding new paths of user growth and advertising revenue could determine its fate in the future.

Overview of Net Income

Twitter Net Income
2014: Net loss of $578 million
2015: Net loss $521 million
2016: Net loss $457 million
2017: Net Profit $108 million
2018: Net Profit $1.21 billion
2019: Net Profit $1.47 billion
2020: Net loss $1.14 billion
2021: Net loss $221 million
2022: Net loss $270 million

Musk’s Takeover

Musk offered to purchase Twitter for $54.20 per share in April 2022; Twitter’s board accepted his bid. Shortly after that, he started having second thoughts about the deal, alleging Twitter misled him regarding aspects such as fake/spam accounts and withholding data.
Musk attempted to end his acquisition deal with Twitter officially by sending them a letter in early July 2022 stating the purchase agreement had been canceled due to “material breaches” by them in terms of providing user data. Twitter denied Musk’s claims and responded by filing suit to force him to complete the deal. Twitter claimed Musk was using bots as an excuse to exit a contract. He just had buyer’s remorse over the following market downturns. That set off a legal battle between Twitter’s lawyers and Musk’s legal teams, wherein Twitter sought to force Musk to keep his commitments. As the October trial date approached, Musk recognized his weak case and realized the possibility of an adverse ruling requiring him to pay billions to Twitter even if he opted out altogether.
Early in October 2022, Musk proposed following through with his original offer pending court resolution of his court case at an initial price of $44 billion. This deal officially closed later that month at its initial value.

Elon Musk and his team have implemented several significant reforms and changes since Musk purchased Twitter:

• Layoffs: Musk fired Twitter’s CEO, CFO, and various senior managers before disbanding its board of directors and cutting 80 percent of employees. Currently the company has a new CEO, Linda Yaccarino , and only has 1500 employees. (Down from 8000 employees)
• Content Moderation Restructuring: He has proposed relying more heavily on automated algorithms instead of human reviewers for content moderation and loosening restrictions, yet details remain vague.
• Blue Checkmark Changes: Twitter Blue subscriptions now feature verified checkmarks, making verification accessible to anyone willing to spend $8/month.
• X Verified organizations: X introduced a verified Organizations subscription for $1,000/month. This allows businesses to get a gold checkmark, and indicated affiliates on the platform. Moreover, organizations can also display job listings.
• Working from Home Ban: Elon Musk has banned remote work and requires all employees to spend at least 40 hours weekly in the office or face termination. Musk has announced several pending feature changes, such as end-to-end encrypted direct messages (DMs), long-form tweets, and the inclusion of payments into tweets.
• Restoring Banned Accounts: Accounts banned due to repeated violations like Donald Trump have now been restored onto the platform.
• Upcoming features: Musk confirmed that video and phone calls are coming to the platform, along with a payment system on Twitter.
• X removed the requirement of having at least 100,000 followers for posts to be newsworthy. Prior to the policy change, only verified accounts would be considered for newsworthy posts. However, now that X allows people to get verified by paying for a subscription, the new version of the policy says posts only by “a high-profile account” counts as newsworthy posts.
• X is making a change to link previews. Instead of showing the headline of the linked article, X will now only show an image with the domain name of the link on the bottom left. This is part of an effort by X owner Elon Musk to encourage users to post “long-form content” directly on the platform, rather than linking to external articles. Musk has said that he believes that users should be spending more time on X, and that linking to external articles is taking away from that experience. He has also said that he believes that link previews can be distracting, and that they can make it difficult for users to focus on the content that is being shared on X.
• Musk wants to transform X into all encompassing application like WeChat, created by Tencent. WeChat is a super application which allows users to play games, chat, call, share media, message, shop, do payments and book services. Whilst modifying, and extending the core capabilities of X corp. , X corp. is also trying to cut costs to ensure future profitability.
• Starting September 29, X will begin gathering user biometric data, including education and job history, with the user’s agreement. The company asserts that this data will be used for safety, security, and identification purposes.
• Paid X users now have the option to hide their likes from their profiles, a feature that rival social media platforms already offer.
• X has lifted its prohibition on paid political ads, a commitment made earlier this year following Elon Musk’s acquisition of the social media platform.