Elon Musk claimed Wednesday X, formerly known as Twitter, could one day become a trillion dollar company, a stellar valuation that few companies have achieved, despite the major turmoil arising since the billionaire took the helm last October.
One of Musk’s first moves after acquiring Twitter was to immediately lay off most of the company’s workforce—staff numbers reportedly fell from more than 7,500 to around 1,300—raising concerns the firm would not have enough staff to properly maintain the platform, moderate content or comply with regulatory requirements.
The abrupt nature of the layoffs and how they were handled have triggered numerous lawsuits from former employees that could end up costing the platform hundreds of millions of dollars.
Unpopular policy changes, notably easing content moderation, implementing an unpopular paid subscription and overhauling the identity verification system, spooked users and sparked chaos when impersonators abused the new system, with advertising revenue plunging as companies pulled ads.
Lawsuits from former staff are just a small fraction of X’s legal woes, which include numerous reports of unpaid office bills, a major copyright lawsuit for letting users post video and audio using copyrighted music, potential brushes with regulators failing to curb the spread of illegal content online and not paying news publishers for content and fees for installing a giant illuminated “X” sign on the roof of the company’s headquarters.
Tech issues have also plagued the platform since Musk’s arrival, including unexplained outages, privacy glitches, randomly logging out users, restrictions on what users can see and throttling the number of posts users could see in a day.
X is also fending off a number of rivals vying for Twitter’s spot, including Bluesky and Spill, headed by former employees and notably Meta’s long awaited Threads, which became the fastest growing app in history days after launching but has since seen a slump in users.
A trillion dollar market cap for X “is not out of the question,” Musk said in a post on Wednesday. It is not the first time the billionaire has made such a prediction and he has a reputation for making sometimes outlandish forecasts. The figure would be a substantial markup from the $44 billion Musk purchased Twitter for in 2022. In a matter of months, Twitter has undergone a drastic transformation, including a rebrand to X. Musk changed the iconic bird logo, which experts told Forbes risks erasing billions in brand value. Though unconventional, the transformation signals a move towards transforming the platform into an “everything app” in the vein of China’s WeChat, something Musk has been promising to build a rival for. These superapps are like virtual Swiss army knives that combine features from multiple apps such as ride hailing, food delivery, payments, investing and messaging and they dominate markets in some parts of Asia where they are essentially ubiquitous in everyday life. There is significant potential for such a model to take off in Western markets and experts told Forbes the rebrand is an opportunity for Musk to add features to elevate the platform beyond social media.
$231.2 billion. That’s how much Forbes estimates Musk is worth. He occupies the top position on Forbes’ list of the world’s richest people, leading French luxury goods magnate Bernard Arnault, who is in second place, by around $18 billion. Musk’s fortune is largely derived from his stake in electric carmaker Tesla and a cohort of valuable companies he cofounded, including rocket firm SpaceX, brain implant company Neuralink and tunneling firm Boring Company.
Very few companies have managed to hit a $1 trillion valuation but X would not be the first of Musk’s companies to reach that threshold. Tesla topped a $1 trillion market capitalization in 2021, the sixth company in U.S. history to pass the milestone. Its value has since dropped well below that level, though is still valued at more than $730 billion.