Social media giant X, formerly known as Twitter, has reported a substantial revenue drop in India, with figures falling by nearly 90% in FY24. The sharp decline has raised questions about Elon Musk’s investment strategy in India, signaling a shift as X continues to operate with a significantly reduced workforce and minimal regional focus.
X, the social media platform formerly known as Twitter, has posted a staggering 90% drop in revenue and profit for the fiscal year 2024, signaling a sharp decline in its Indian operations. Owned by Elon Musk, X recorded a revenue of Rs 21.1 crore for FY24, a significant decrease from Rs 207.7 crore in the previous fiscal year. The drop, reflected in the platform’s standalone financial statements filed with the Ministry of Corporate Affairs, indicates that India’s role in X’s global strategy may be dwindling, sparking speculation about Musk’s future investments in the country.
The once-bustling Twitter Communications Pvt. Ltd., which rebranded to X following Musk’s acquisition, has downsized substantially since the takeover. The company’s workforce has been slashed by 90%, leaving only 12 employees in India, and its employee expenses fell from Rs 130.1 crore to just Rs 6.2 crore. This workforce reduction follows Musk’s sweeping operational changes aimed at streamlining costs, particularly in global offices outside the United States.
Revenue Plunge and Profit Nosedive: A Financial Overview
The financial downturn in X’s Indian operations has been dramatic. After recording a robust Rs 207.7 crore in revenue for FY23, the company’s income shrank to Rs 21.1 crore in FY24, mirroring a 90% decline. Profit similarly plummeted, falling from Rs 30.4 crore to Rs 3.1 crore, reflecting the challenging adjustments the company has faced under Musk’s leadership. This stark decrease highlights the limited success of recent monetization strategies, including the introduction of paid verification, which was rolled out globally as part of Musk’s new revenue model.
According to the company’s financial reports, operational changes have reduced India to a relatively small segment of X’s market, despite the fact that the platform still boasts a user base of around 25 million users in the country. The impact of the user base on revenue has apparently been limited, with minimal returns from India compared to its potential market size.
This decision to shrink X’s Indian workforce reflects a strategy to reduce operational costs worldwide. However, Musk’s approach in India has been particularly aggressive, leaving only 12 employees to manage the regional market. Employee benefits, largely encompassing salaries, dropped drastically from Rs 130.1 crore to Rs 6.2 crore – a cost-cutting move that may have saved the company in the short term but could limit growth potential in one of the world’s largest social media markets.
Leadership in India: A Two-Person Board Amid Downsizing
The current leadership structure in X India stands as another testament to the company’s downsized operations. X India’s board now comprises only two individuals: executive Anup Ashok Malashetti and Winston Sei Seng Foo, the Regional Controller for Asia-Pacific. The downsizing of the board aligns with Musk’s restructuring of Twitter’s global leadership after his takeover, which aimed to centralize control and streamline decision-making.
Despite Musk’s intention to monetize the platform with new features, including the controversial move to charge for previously free verification marks, the financial results suggest that these efforts have not had a significant impact on X India’s revenue stream. The reduction in workforce and leadership personnel indicates a shift in focus, as India moves from being a central market to a peripheral segment of the company’s overall operations.
This leadership reduction is seen by analysts as a sign of X India’s diminished priority in Musk’s larger strategy, in contrast to platforms like Meta and Google, which continue to invest heavily in India. By retaining a minimal presence, X appears to be taking a conservative approach, possibly limiting future growth opportunities in a country that could potentially become one of the largest digital markets worldwide.
India’s Role in Musk’s Investment Strategy: Future Prospects
The sharp revenue decline raises questions about the future of Musk’s investments in India, particularly in the social media sector. With a reduced workforce, diminished financial performance, and an apparent shift away from aggressive growth in India, X’s future in the country remains uncertain. Musk’s previous moves in India, including attempts to bring Tesla to the Indian market, have faced delays, and X’s financial results could influence his decisions about further investments in the country.
The current scenario suggests that Musk may take a cautious stance toward future projects in India. The government’s increasing focus on data localization and digital regulations might also be contributing factors to Musk’s conservative approach in India. While tech giants such as Google, Meta, and Amazon are expanding their investments and regional presence, Musk’s X appears to be taking a back seat, prioritizing cost control over market expansion.
For Indian users, the downsizing at X may mean fewer locally relevant updates, content moderation challenges, and limited support for regional languages. This move could leave a gap for other social media platforms looking to expand in India, where the digital ecosystem is growing rapidly. While India’s large user base could still prove valuable, it remains to be seen whether X will capitalize on this potential or continue its current scaled-down approach.
In summary, the drastic decline in revenue and profit reflects the significant changes in X’s operational model under Musk’s leadership. The company’s decision to minimize its workforce and scale back investment in India aligns with Musk’s broader vision for a leaner organization, yet it raises questions about the company’s future in one of the world’s fastest-growing social media markets. The shift could also impact Musk’s other ventures, as the Indian market watches closely to see if these adjustments will alter his long-term investment trajectory in the country.
Elon Musk’s X has shifted gears in India, showing a cautious approach despite a significant user base. The dramatic fall in revenue and profit underlines a strategic pivot away from aggressive regional growth, and Musk’s subsequent moves in India will be closely watched. For now, X remains in the periphery of India’s digital landscape, potentially ceding ground to more locally engaged platforms.