Do you recall the earlier reports indicating that X was projected to face a significant financial deficit for the year? At that time, X executives confidently asserted, “Our advertising revenue will hold strong; we’ll earn substantial income from the U.S. elections and the Olympics.”

It seems those optimistic projections may not have materialized, as Elon Musk’s personal social network is now making aggressive moves to maximize its revenue during the closing months of the year.

This week, X has initiated full-screen promotional campaigns for X Premium, aiming to convert more users into paying customers for the application.

Alongside this initiative, X has unveiled a new advertising promotion in collaboration with Shopify, where X will match the advertising expenditures of Shopify merchants throughout this holiday season.

According to X:

“From now through December 1st, we’re offering Shopify store owners an unbeatable deal to help you scale your business and drive more sales. To help you take advantage of this exciting new update, we’re offering a 100% ad credit match when you speak with an X Ads Specialist.”

It’s important to note that there are certain conditions attached to this offer; merchants must commit to a specified level of advertising spend with X and link their Shopify account to the platform. The promotional ad credits will be valid for just 30 days, but these stipulations are relatively minor when considering the potential for essentially free advertising on X.

However, offering something for free typically indicates that demand is high, and this promotion might suggest that X is facing challenges regarding overall advertising intake.

Many advertisers have distanced themselves from X in light of Elon Musk’s controversial modifications to the platform, including significant changes in content moderation, which now relies more heavily on Community Notes—a system that many believe is inadequate—and the rise of controversial political commentary.

Moreover, the increasing visibility of Musk himself on the platform has made some brands hesitant to engage in advertising on X. Musk appears to be using the platform as a megaphone for his political beliefs, further complicating the landscape for brands aiming to reach their target audiences effectively.

This context explains why X was projected to experience considerable financial losses this year, especially with the upcoming election and Olympic events on the horizon.

As we reported last month, X is currently estimated to generate around $2.9 billion in total revenue for 2024, a significant drop from the previous year’s total of $4.4 billion that Twitter generated in 2022. Following Musk’s acquisition of the platform late in 2022, his ambitious plans to transform X into a billion-user platform have yet to yield the expected results.

While Musk may have achieved some success in his broader political ambitions, particularly in relation to Donald Trump, X itself is grappling with serious financial challenges. These challenges are exacerbated by the $1.2 billion in annual loan repayments Musk introduced when he purchased the platform.

What remains after these obligations is unlikely to cover X’s operational costs. However, it’s worth noting that the company has closed down several offices, including its headquarters in San Francisco, and has laid off a considerable number of employees. These actions may have reduced overhead costs more than many realize.

Despite these adjustments, X might still find itself in a precarious financial position. If it cannot stabilize its advertising revenue, the threat of bankruptcy looms large over the company’s future.

On a more optimistic note, there are indications that some major advertisers are starting to return to X. This shift may be driven by a desire to align with Musk, who is anticipated to wield considerable influence in a potential second Trump administration. The prospect of Trump’s return to power could also lead to a reevaluation of audience engagement strategies, prompting more businesses to reconsider their presence on the platform.

A significant reversal would be required for X to regain its footing, but it appears that Musk is intent on utilizing the platform to influence political results in his favor.

It seems unlikely that Musk will abandon these efforts easily. With his political maneuvers and connections, it is reasonable to assume that he will find a way to keep the company afloat, one way or another.

Nonetheless, this recent promotional offer highlights the ongoing struggles X faces in regaining the trust of advertisers and revitalizing its advertising business. These challenges will remain critical to the company’s prospects moving forward.

If you’re a Shopify merchant, don’t miss out on the opportunity for free expanded advertising campaigns on X; it could be a game-changer for your business!