X is apparently sinking, as the company is struggling to stay financially afloat, according to the news reports by Verge and Wall Street Journal.

According to the two media outlets, they have gained insights on a private email between an X employee and Musk, where Musk was apparently ranting about the dire financial situation of the company....

"Our users growth is stagnant, revenue is unimpressive, and we're barely breaking even. We've witnessed the power of X in shaping national conversations and outcomes over the past few months."

Banks panics and frantically tries to sell off their debts

The news of the financial instability has spooked Wall Street Banks, who are reportedly getting ready to sell off the $3 billion debt holdings in X.

These banks include Morgan Stanley, Bank of America, Barclays, BNP Paribas, Muzuho, and Societe Generale, who had lent Musk money to complete his $44 billion buyout of X back in 2022. It was also reported that Morgan Stanley has already contacted investors ahead of a planned sale next week.

X's bad omen started when Musk suddenly started launching a bunch of sweeping regulations, including the massive layoffs of many workers who had worked to moderate content and its regulation regarding content modulation has scared away advertisement, leading to the plummeting of the company's sales and revenue.

All these financial struggles are causing the value of the debt to decrease, which is causing banks to desperately sell the debts; but banks are hoping to quickly sell the debt at 90-95 cents on the dollar before the value of the debts inflate even further.

Banks are also slowly losing their faith in Musk, as he has proven that he is failing to keep to his word when it comes to the finances of the company. Back in 2023, Musk had promised that the company would be cash-flow positive within months; but the company is still facing over $1 billion in annual interest payments on loans.

Could Musk really turn X around?

In his X post, Musk has denied these claims and said that he had "sent no such emails." Some are also claiming that since Musk has now risen up to the become the right-hand man of Trump, could he get financial resources from the President himself?

Could Musk's links to Donald Trump lead more investors to be interested in buying stakes in the company on the belief that its financials are on the way up?

Banks are also wondering if the improved prospect of the social media platform, could mean that they could be selling the debt without having to take a massive loss on the deal?

Meanwhile, Musk's vocal support of Trump has also driven many users to alternative platforms. It was estimated that roughly 115,000 US based web visitors have deactivated their X accounts after election day according to internet traffic analyzer Similarweb.

At the same time, Bluesky has seen its user base explore in 2024, with the social network expanding its users almost ninefold, from 2.89 million to 25.94 million users.