Elon Musk sets ambitious goal: A $1 trillion market cap for the X platform

Elon Musk's aspiration for the success of the X social media platform is no hidden secret. His acquisition of the platform at a notably inflated valuation, accompanied by some sarcastic remarks from his critics, underscores his strong intent. However, Musk's revealed ambitious objectives for X might be venturing into challenging territory, even for the renowned and accomplished CEO.

Elon Musk sets ambitious goal: A $1 trillion market cap for the X platform

Elon Musk's latest tweet brings into focus the possibility of X achieving a staggering $1 trillion market capitalization, a prospect that requires careful examination. This reference to X's market cap hints at Musk's potential intention to take the platform public once again.

Nevertheless, a pivotal question arises: how likely is this monumental feat? According to insights from fervent Tesla supporter Gary Black, to realize a $1 trillion market cap, X would need to trade at an astonishing 40x Enterprise Value (EV) to Revenue multiple in 2023. Yet, the current landscape of social media companies does not support such towering multiples; even industry giant Google stands at a modest 6.3x EV/Revenue multiple.

A trillion dollar market cap for this platform is not out of the question

— Elon Musk (@elonmusk) August 23, 2023

Notably, Musk envisions transforming X into an "everything app," a pursuit fraught with challenges. Even a company like Tencent, responsible for the comprehensive WeChat super app, averaged a considerably lower EV/Revenue multiple of 6.7x between 2018 and 2022.

Recent announcements from Musk tout a record-breaking 541 million users on X in 2023, a marked increase from the 368 million average monthly users in 2022. Musk's enthusiasm is palpable, particularly as this surge follows the elimination of a substantial number of bots.

In a recent conversation, the world's wealthiest individual divulged his two-decade-long strategy to shape X into the most valuable financial institution globally.

The question lingers: Is Elon Musk's pursuit of a $1 trillion valuation for the X platform grounded in realism? 

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