Why Elon Musk Really Bought Twitter (X) – And What Changed After

Elon Musk completed a $44 billion Twitter acquisition in October 2022, causing immediate shockwaves through Silicon Valley and social media worldwide. He famously tweeted “The bird is freed” to mark the deal, signaling his intent to shake up the platform. Musk described the acquisition as more than a business move. He said he bought the platform “not to make more money but to try to help humanity.” High-minded goals, such as free speech, democracy, and public debate, were the driving motivations for why Musk bought Twitter.

Why Musk Bought Twitter: Free-Speech & Vision

When Elon Musk agreed to acquire Twitter in 2022, he framed the move as a mission to safeguard free speech. He also aimed to reinvent the platform as a more open, transparent digital public square. Musk described himself as a “free speech absolutist.” He asserted that Twitter had failed to live up to its potential as a global forum for debate and discussion. In a tweet shortly before the acquisition was announced, he wrote, “Free speech is the bedrock of a functioning democracy. Twitter is the digital town square where matters vital to the future of humanity are debated.”

Business considerations were also another major reason why Musk bought Twitter. Media analysts speculated that Musk viewed Twitter as undervalued and possessing untapped growth potential, particularly in comparison to giants like Facebook/Meta. He spoke of transforming the service into an app that could handle messaging, media, and even financial transactions. Musk pitched Twitter as a platform he could radically expand and monetize the same way as WeChat.

Financing the Deal

Musk financed the roughly $44 billion acquisition using his own funds, investor funds, and loans. Financial filings show he lined up about $46.5 billion in equity and debt to close the deal. Roughly $13b came from bank loans secured against Twitter itself, led by Morgan Stanley, BofA, and others. Musk also personally provided about $27B in cash-equivalent funding, selling roughly $15.5B of Tesla stock. He also leveraged his existing 9.6% Twitter stake.

Prominent tech figures joined in. Larry Ellison, the Oracle cofounder, invested $1b, and Qatar’s sovereign fund and Saudi Prince Alwaleed added capital. The latter even transferred his 35 million Twitter shares to Musk.

Major Changes Post-Acquisition

Once in control, Musk swiftly rebranded and restructured the platform. In July 2023, the platform officially became “X,” replacing the famous bird logo with a stylized X and changing the app name. Musk said the decision was more than a cosmetic change. One of the reasons why Musk bought Twitter was to evolve into an all-inclusive app that combines communications, media, and finance. He argued the old name made sense for 140-character posts also known as tweets. However, now users can share hours of video or send money, so a new identity was needed.

Content moderation policies shifted under Musk. He rolled back some of Twitter’s previous restrictions. For example, a rule forbidding misgendering or deadnaming transgender users was quietly removed. What’s more, he opposed blanket bans and instead favored freedom of speech, not freedom of reach. In practice, X began limiting the visibility of controversial posts rather than outright deleting many tweets or accounts.

At the same time, the platform claimed to strengthen its fight against illicit content. The company reports doubling down on child sexual exploitation detection, leading to a sharp rise in flagged accounts. Overall, X’s policies became more laissez-faire on some kinds of offensive speech, which alarmed some advertisers and advocates, but he insisted the site would not become a hellscape.

Staff Cuts and Restructuring

One of the most dramatic changes after Musk bought Twitter was the workforce reduction. He laid off roughly half of Twitter’s 7,500 employees within days of closing the deal. In early November 2022 alone, Musk laid off or encouraged the resignation of about 3,700 people, many of whom held safety and moderation roles. Over time, the cuts deepened. In total, around 6,000 employees, or 80% of the staff, were let go, and entire departments like trust & safety and communications gutted.

The remaining staff were given an ultimatum: either work at an extremely intense pace or accept a brief severance package. These purges sparked numerous legal claims. For instance, former employees filed lawsuits alleging unpaid severance and unlawful layoffs. Executives, including ex-CEO Parag Agrawal, sued him for $128 million in promised severance pay.

The mass firings earned him comparisons to a restructuring factory. One news headline noted his swift “Department of Government Efficiency” style across both Twitter and his efforts to reform government agencies. In practical terms, X now operates with a skeletal team, relying more on automation and partnerships for content review.

New Features: Subscriptions & Verification

Musk introduced paid subscriptions and revamped the verification system. The flagship offering is X Blue for $8/month or $11 on Apple iOS, where users get a blue checkmark and other perks. He also proclaimed the legacy “lords & peasants” verification system was “bullshit,” tweeting, “Blue for $8/month, power to the people!” In practice, anyone who subscribes to X Premium now receives a blue checkmark, whereas Twitter previously vetted celebrities and journalists for verification.

The shift initially caused chaos, as impostor and parody accounts appeared with blue ticks. This prompted X to change its subscription requirements to include phone verification and additional checks. By March 2023, the platform announced that it would completely end the old legacy verified program. As such, all existing authenticators, including politicians and news media, lost their checks if they didn’t subscribe.

Other new features are currently in development as part of his “everything app” vision. X has also piloted audio chat rooms, video streaming, news integration, and even an AI chatbot (“Grok”). The company also plans to add financial tools, such as payment options and banking services, in the future. Mobile interface changes and an API monetization plan have been rolled out.

Advertiser Reactions and Revenue Impact

In late 2023, dozens of big brands, including Disney, IBM, and Apple, paused their ad budgets on X. This withdrawal happened after Musk publicly endorsed a controversial post and berated advertisers during a profanity-laden rant. He famously told withdrawing companies to “go fuck” themselves, accusing them of censorship blackmail.

Media reports at the time warned X could lose up to $75 million in ad revenue for the quarter. However, X later estimated a more modest $10-12 million drop. To compensate, this platform has tried to attract small and mid-sized businesses, which Musk says were underplayed before.

Industry analysts project that X’s ad revenue will grow by mid-teen percentages in 2025. For example, eMarketer forecasts U.S. ad sales of $1.31 b (up 17% yoy) and global ads of $2.26 b (up 16.5%). This pickup is partly due to Musk’s emphasis on regaining advertiser trust and tapping the long-neglected small-business segment.

However, even after this growth, X’s ad business remains smaller than before Musk took over. In 2021, its last full public year, Twitter reported $4.5b in ad revenue.

User Base and Global Influence

X (formerly Twitter) remains one of the world’s major social platforms, though its growth dynamics have changed. Analysts estimate that the platform has approximately 560 to 600 million monthly active users as of today. For context, Brian Dean’s 2025 survey suggests 561 million monthly active users, down from 586 million in mid-2024. However, daily active user metrics are murkier since X is now private, with data showing around 132 million daily actives on X in mid-2025.

Giants like Facebook or YouTube dwarf X’s audience by any measure. However, it remains a top-10 platform in most countries. Its largest markets are still the U.S., Japan, and Indonesia, with the U.S. alone accounting for 104 million users.

Increased Competition

Meta’s Threads app reached 350 million monthly active users within months of its mid-2023 launch. SimilarWeb data in mid-2025 indicated Threads had 115 million mobile daily active users globally, vs. 132 million on X. In the U.S. mobile market, X’s lead is narrower, with 22.9 M daily active users vs 15.3 M for Threads. The key point is that smaller upstarts have reduced X’s market share, particularly among younger users. However, X’s influence remains significant.

X’s user base includes politicians, celebrities, and news outlets, and it often drives news cycles, sometimes controversially. For example, X, via Musk’s own posts, has swayed public debate on topics from politics to finance. Globally, the site has also attracted government scrutiny. In India, for instance, courts fined the platform due to its response to content removal orders related to disputes over farmers’ protest posts. However, Musk’s team says it will soon appeal this case. Similarly, European and U.S. regulators have closely monitored the platform for hate speech and privacy issues. Despite the uncertainty surrounding its future, X continues to serve as a key “town square” in many countries, exerting significant influence on news and public discourse.

Legal Challenges and Controversies

Numerous legal battles have engulfed X under Musk’s leadership:

• In January 2025, the SEC sued him for violating securities law by delaying the disclosure of his 2022 Twitter stock purchase. The complaint alleges Musk waited 11 extra days to report crossing a 5% ownership threshold, costing other investors about $500 million.
• Former Twitter staff also sued him over the chaotic layoffs and severance. One class-action suit in California alleged illegal mass firings.
• Another was filed by Twitter’s ex-CEO and other executives claiming Musk reneged on a promised severance of about $128 million in total.

Musk’s company itself has challenged laws. In June 2025, X sued the state of New York to block the “Stop Hiding Hate Act,” which requires platforms to publicly report how they moderate hate speech and extremism. X argues this law violates free-speech rights by forcing disclosure of internal policies. This suit followed a similar one in California, which was settled when X agreed not to enforce parts of that law. Internationally, X is involved in litigation too. In India, for example, this platform was fined for not removing court-flagged content under the Information Technology Act. X is, however, appealing the Karnataka High Court’s ruling that Indian moderation standards must apply globally.

Beyond the courts, Musk’s erratic management style has sparked controversies. He has criticized advertisers and regulators on X, sometimes drawing accusations of xenophobia or antisemitism. However, he rebuked those who said his post was antisemitic, leading to a media frenzy and further ad boycotts.

Musk has also had public disputes with Twitter’s original board and even teased selling the company or moving operations abroad. X’s post-acquisition era has been marked by a whirlwind of litigation, regulatory skirmishes, and public-relations firestorms, highlighting how his ownership has fundamentally altered Twitter’s global position.

Why Musk Bought Twitter: Has it Been Worth It?

Elon Musk’s Twitter acquisition journey has been a roller coaster of bold promises, sweeping changes, and sharp reactions. On one hand, he quickly rebranded Twitter into “X,” loosening some speech restrictions, introducing new paid features, and cutting costs. On the other hand, these changes led to significant staff departures, a reduction in advertising, and ongoing legal battles.

Today, X is leaner, rebranded, and structured around his vision of free expression and subscriptions. So far, he has incurred huge costs—financial, reputational, and legal—to restore trust with advertisers and users. For supporters who prioritize unrestricted free speech and innovation, the changes may seem justified.

For critics concerned about stability, safety, and profitability, the deal has been chaotic. From a global perspective, Twitter’s influence remains large. However, Musk’s era has also emboldened competitors like Meta’s Thread and scrutiny by governments worldwide. Only time will tell whether X will evolve into the “everything app” that Musk envisions. What is clear, however, is that in buying Twitter, Musk changed the platform and ignited an ongoing debate about the future of online speech and media.