SpaceX’s first quarterly earnings report as a public company has provided a rare look at the financial performance of X, the social-media platform formerly known as Twitter, and the numbers show a dramatic contraction in its advertising business since Elon Musk acquired the company in 2022.
X generated approximately $367 million in advertising revenue in the second quarter of 2026, according to figures disclosed in SpaceX’s earnings. That compares with $1.08 billion in advertising revenue recorded by Twitter in Q2 2022, the last quarterly report before Musk completed his acquisition.
The comparison represents a decline of roughly 66% in quarterly advertising revenue.
The figure is particularly striking because Musk had previously outlined an ambitious plan to transform Twitter into a much larger business. His 2022 projections envisioned advertising revenue reaching $12 billion annually by 2027, according to Techdirt’s analysis of the plans presented during the acquisition period.
Instead, based on the latest quarterly figure, X’s advertising business is running at an annualised pace of roughly $1.47 billion.
X / TWITTER ADVERTISING BUSINESS
Q2 2022
Twitter
$1.08 BILLION
████████████████████████████████████████
Q2 2026
X
$367 MILLION
█████████████
Decline
≈66%
Musk's 2027 target
$12 BILLION annually
████████████████████████████████████████████████
X’s advertising business has shrunk dramatically
Twitter’s Q2 2022 financial results reported advertising revenue of $1.08 billion, representing a 2% year-on-year increase at the time. Total quarterly revenue was $1.18 billion.
Four years later, X’s advertising revenue was only $367 million in Q2 2026.
The comparison is not completely like-for-like in every accounting respect because X is now part of a larger corporate structure and SpaceX reports its businesses differently from the old standalone Twitter. Nevertheless, the disclosed numbers provide the clearest recent indication of the scale of the advertising business.
| Period | Company | Quarterly ad revenue |
|---|---|---|
| Q2 2022 | $1.08 billion | |
| Q2 2025 | X | $426 million |
| Q1 2026 | X | $343 million |
| Q2 2026 | X | $367 million |
| Musk’s 2027 annual target | X/Twitter | $12 billion |
The latest $367 million figure was higher than the previous quarter’s $343 million, but it remained below the $426 million recorded in the same quarter a year earlier.
The quarterly decline works out to about 66%
The difference between $1.08 billion and $367 million is approximately $713 million.
That means X’s quarterly advertising revenue is now about one-third of what Twitter reported before Musk took control.
Q2 2022 → Q2 2026
$1.08B
↓
$367M
Revenue lost:
≈ $713M per quarter
Percentage decline:
≈ 66%
On an annualised basis, the contrast becomes even more dramatic.
ANNUALISED AD REVENUE
Twitter Q2 2022 run rate
$1.08B × 4
≈ $4.32B
X Q2 2026 run rate
$367M × 4
≈ $1.47B
Difference
≈ $2.85B annually
These are simple annualised calculations and are not forecasts.
Musk’s $12 billion advertising ambition
The latest numbers are particularly notable because of the scale of Musk’s original ambitions for Twitter.
Plans associated with Musk’s acquisition envisioned Twitter’s annual advertising revenue reaching $12 billion by 2027, while the company would also build substantial subscription revenue. Techdirt recently highlighted the gap between that ambition and the company’s current advertising performance.
It is worth noting that some reports on Musk’s 2022 pitch deck placed the $12 billion advertising target in 2028 rather than 2027. The widely reported pitch-deck plan projected total Twitter revenue of about $26.4 billion by 2028, with advertising accounting for $12 billion.
So the safest interpretation is that Musk’s acquisition-era plans envisioned $12 billion of annual advertising revenue by the late 2020s, with 2027 or 2028 cited depending on the version or reporting of the plan.
MUSK'S ORIGINAL VISION
Twitter advertising
≈ $4.5B in 2021
↓
Aggressive growth
↓
$12B annual advertising
target in acquisition-era plans
↓
Late 2020s
The latest quarterly numbers show how far the business remains from that ambition.
The gap between the target and current run rate
If X’s Q2 2026 advertising revenue of $367 million were simply annualised, it would generate approximately $1.47 billion.
Compared with a $12 billion annual target:
| Measure | Amount |
|---|---|
| Q2 2026 ad revenue | $367 million |
| Annualised Q2 2026 run rate | ~$1.47 billion |
| Musk-era target | $12 billion |
| Gap | ~$10.53 billion |
| Current run rate as % of target | ~12.2% |
$12B TARGET
████████████████████████████████████████████
$1.47B CURRENT RUN RATE
█████
Current annualised run rate
≈ 12% of target
This is the clearest way to understand the scale of the shortfall.
X’s advertising business initially suffered an advertiser exodus
The deterioration followed Musk’s takeover of Twitter in October 2022.
Major advertisers pulled back spending amid concerns over content moderation, brand safety and changes to the platform.
Advertising was historically the core business model for Twitter, making advertiser confidence particularly important.
The post-acquisition period saw substantial disruption to that model, with Musk publicly pressuring advertisers to return while the company attempted to rebuild its advertising operation.
MUSK ACQUISITION
October 2022
↓
Policy + moderation changes
↓
Advertiser concerns
↓
Brand pullbacks
↓
Lower ad spending
↓
Revenue decline
X has tried to diversify beyond advertising
One reason the company has not relied exclusively on advertising is its attempt to create additional revenue streams.
These include:
- X Premium subscriptions
- Premium business accounts
- Payments ambitions
- Creator-related products
- AI products through Grok
- Data and API-related businesses
- Enterprise services
Musk’s acquisition-era plans envisioned a significant expansion of subscription revenue alongside advertising.
OLD TWITTER MODEL
Advertising
████████████████████████████
Subscriptions
██
MUSK'S VISION
Advertising
██████████████████
Subscriptions
██████████
Payments
███
Other services
███
The strategy was designed to make the platform less dependent on advertisers.
But advertising remains an important part of X’s economics
Despite diversification efforts, advertising remains a crucial component of X’s business.
That creates a difficult strategic balance.
If X reduces moderation or changes the user experience in ways that advertisers dislike, ad revenue can fall.
If it prioritises advertisers too heavily, the platform could potentially lose some of the identity and audience Musk wanted to build.
X'S STRATEGIC BALANCE
User freedom / engagement
↕
Content moderation
↕
Brand safety
↕
Advertiser confidence
↕
Advertising revenue
Finding a sustainable balance has been one of the central challenges of the Musk era.
Q2 2026 shows some improvement from Q1
The latest figure is not entirely negative.
X’s Q2 advertising revenue of $367 million was higher than the $343 million recorded in Q1 2026.
That represents an increase of about 7% quarter-on-quarter.
Q1 2026
$343M
████████████
↑ ~7%
Q2 2026
$367M
█████████████
However, the more important comparison is year-on-year.
Q2 2026:
$367 million
Q2 2025:
$426 million
That means advertising revenue was still down by about 14% year-on-year.
So the business appears to have stabilised somewhat from the previous quarter, but it has not yet returned to sustained annual growth.
The broader X business is changing
The decline in advertising becomes more interesting when viewed alongside SpaceX’s broader financial results.
SpaceX reported $7.8 billion in Q2 2026 revenue, up roughly 92% year-on-year, driven by strong growth across connectivity, space and AI businesses.
This creates an unusual situation.
SpaceX is growing rapidly overall while the X advertising business remains relatively small and under pressure.
SPACEX
Q2 revenue
$7.8B
↑
92%
VS.
X advertising
Q2 revenue
$367M
↓
14% YoY
The contrast highlights how much SpaceX’s growth is being driven by businesses other than X advertising.
Starlink is now far more important to SpaceX’s growth
Starlink has become one of SpaceX’s most important revenue engines.
According to recent earnings reporting, Starlink and related connectivity services generated approximately $4.3 billion in Q2 revenue, while its subscriber base reached around 12 million.
SPACEX Q2 2026
Connectivity / Starlink
≈ $4.3B
████████████████████████
AI
≈ $2.6B
██████████████
X advertising
$0.367B
██
The figures illustrate the relative scale of the advertising business within the broader SpaceX ecosystem.
AI is also becoming a major part of SpaceX’s strategy
SpaceX’s Q2 results showed that AI is becoming another major business area.
AI-related revenue was reported at approximately $2.6 billion, more than triple the year-earlier level, according to recent earnings coverage.
This means the financial centre of gravity around Musk’s businesses is increasingly shifting toward:
- Starlink
- AI infrastructure
- Compute
- Data centres
- Space launches
rather than traditional social-media advertising.
MUSK'S BUSINESS ECOSYSTEM
SpaceX
│
┌─────────┼─────────┐
↓ ↓ ↓
Starlink Space AI
│ │
│ ├── xAI
│ ├── Grok
│ ├── Compute
│ └── X
│
└─────────┬─────────┘
↓
Digital ecosystem
X is now part of a much larger AI ecosystem
The corporate structure has also changed dramatically since 2022.
X was acquired by Musk in 2022 and later became intertwined with xAI. In March 2025, xAI acquired X in an all-stock transaction that valued X at $33 billion in equity value, or $45 billion including debt, according to reporting at the time.
X subsequently became part of the broader SpaceX structure.
This means X’s advertising business is now only one component of a much larger technology ecosystem.
Why X’s advertising decline still matters
Even though X is now much smaller relative to SpaceX’s total revenue, its advertising performance remains important for several reasons.
1. It measures advertiser confidence
Advertising spending provides a direct signal of how brands view the platform.
2. It tests Musk’s original turnaround thesis
The acquisition thesis depended partly on dramatically increasing monetisation.
3. It affects X’s ability to fund itself
A weak advertising business means greater reliance on subscriptions, AI-related revenue and other businesses.
4. It highlights the cost of platform disruption
Twitter had an established advertising machine before the acquisition.
Rebuilding that business has proved difficult.
The $12 billion target now looks extremely distant
The scale of the gap can be expressed through growth requirements.
If X were generating an annualised $1.47 billion in advertising revenue and wanted to reach $12 billion, revenue would need to increase more than 8 times.
CURRENT RUN RATE
~$1.47B
↓
×8.2
↓
TARGET
$12B
That would require an extraordinary sustained growth rate.
And importantly, the company would need to achieve that while competing against much larger digital advertising platforms such as Meta, Google, TikTok and Amazon.
Competition in digital advertising has intensified
The online advertising market has become increasingly competitive since Musk’s acquisition.
Advertisers have many alternatives:
| Platform | Main advertising strength |
|---|---|
| Search intent | |
| Meta | Massive social audience + targeting |
| TikTok | Short-form video engagement |
| Amazon | Purchase intent |
| YouTube | Video + Google ecosystem |
| X | Real-time conversation / news / influence |
X’s biggest differentiation remains its role in real-time public conversation.
The challenge is turning that engagement into advertising revenue at the scale Musk envisioned.
X’s unique advantage is real-time influence
Despite its financial challenges, X retains an important asset: it remains a major platform for real-time information.
Politicians, journalists, investors, businesses, celebrities and technology communities continue to use the platform.
That creates advertising opportunities around:
- News
- Sports
- Finance
- Technology
- Politics
- Entertainment
- Live events
REAL-TIME CONTENT
↓
High user attention
↓
Trending topics
↓
Conversation
↓
Advertising opportunities
The challenge is monetising that attention without damaging the user experience or advertiser confidence.
X’s advertising recovery remains uncertain
The Q2 figure suggests that the platform’s advertising business may have reached some degree of stabilisation, but there is not yet evidence of a return to the scale of the pre-Musk Twitter business.
The sequence is important:
Q2 2022
$1.08B
↓
Musk acquisition
↓
Advertiser disruption
↓
Sharp decline
↓
Q2 2025
$426M
↓
Q1 2026
$343M
↓
Q2 2026
$367M
The latest number is better than Q1 but still substantially below the pre-acquisition level.
What happened to Musk’s original growth thesis?
Musk’s acquisition strategy was built around the idea that Twitter was an under-monetised platform with significant room for expansion.
His plans included:
- More users
- Higher engagement
- Subscription growth
- Payments
- Advertising growth
- Lower dependence on traditional advertising
The idea was to transform Twitter from a roughly $5 billion annual-revenue company into a much larger technology platform.
But the advertising portion of that thesis has clearly not materialised at the projected pace.
MUSK'S VISION
More users
+
More engagement
+
More subscriptions
+
Payments
+
Advertising growth
↓
$26B+ annual revenue vision
The current advertising figures show the biggest gap between the original plan and the present business.
The numbers also highlight how much Twitter had already built
Twitter’s Q2 2022 advertising revenue of $1.08 billion demonstrates that the platform already had a large advertising operation before Musk’s takeover.
That makes the current $367 million figure particularly significant.
The challenge was not building an advertising business from zero.
It was preserving and expanding an established advertising business while radically changing the platform’s ownership, moderation policies, management structure and product strategy.
Advertiser confidence is critical
Digital advertisers generally care about:
- Audience scale
- Engagement
- Brand safety
- Targeting
- Measurement
- Conversion
- Reputation
X can offer strong engagement around breaking news and major events, but advertisers have historically expressed concerns about the environment surrounding the platform after Musk’s takeover.
The company has attempted to address these concerns through changes to advertising tools, verification systems and brand-safety initiatives.
But the revenue figures indicate that the recovery remains incomplete.
Subscriptions and AI may be the new growth engines
If advertising cannot return to the levels Musk originally expected, X will need other sources of revenue.
That is where the integration with xAI becomes strategically important.
X can potentially serve as a distribution channel for:
- Grok
- AI subscriptions
- Premium services
- AI-powered search
- Personalised recommendations
- Creator tools
- Business services
X USERS
↓
X PLATFORM
↓
Grok / AI
↓
Premium subscriptions
↓
Recurring revenue
This model could reduce the company’s dependence on advertising.
But AI does not automatically solve X’s advertising problem
The rise of AI-related revenue elsewhere in the Musk ecosystem does not mean X’s advertising business has recovered.
These are separate economic engines.
X ADVERTISING
$367M
│
└── Brand spending
AI BUSINESS
~$2.6B Q2
│
└── Compute / AI infrastructure
STARLINK
~$4.3B Q2
│
└── Connectivity
SpaceX’s overall growth can therefore coexist with a weak advertising business at X.
What investors should watch next
The most important indicators for X will be:
1. Year-on-year advertising growth
Can X turn the current quarterly stabilisation into sustained growth?
2. Advertiser retention
Are major brands returning permanently or spending only tactically?
3. Premium subscribers
Can X grow recurring subscription revenue?
4. Grok adoption
Can AI products generate meaningful revenue from X’s user base?
5. User engagement
Can X maintain its relevance in real-time conversation?
6. Advertising technology
Can better targeting and measurement improve advertiser returns?
7. Brand safety
Can the company balance Musk’s free-speech philosophy with advertisers’ requirements?
X advertising dashboard
X AD BUSINESS
Q2 2022
$1.08B
████████████████████████████████████████
Q2 2025
$426M
████████████████
Q1 2026
$343M
████████████
Q2 2026
$367M
█████████████
Musk-era target
$12B annually
████████████████████████████████████████████████
The visual makes the central story clear: X has recovered somewhat from its recent low, but it remains far below Twitter’s pre-Musk advertising scale and dramatically below Musk’s original late-decade ambition.
What the $367 million figure means for X
The latest result does not necessarily mean that X’s advertising business is permanently broken.
The platform still has:
- A large global audience
- Strong real-time engagement
- Influential users
- Political and business relevance
- Growing integration with AI
- Multiple monetisation opportunities
But the economics have changed.
The company is now pursuing a model in which advertising is only one piece of a broader ecosystem.
OLD TWITTER
Users
↓
Content
↓
Ads
↓
Revenue
NEW X
Users
↓
Content
├── Ads
├── Premium
├── Grok
├── Payments
├── Creator products
└── Enterprise / AI
↓
Diversified revenue
The broader lesson from the numbers
The X advertising figures provide an unusual case study in how quickly a digital platform’s economics can change after an ownership transition.
Twitter entered Musk’s ownership with a billion-dollar quarterly advertising business.
Four years later, the successor platform is generating only about one-third of that quarterly advertising revenue.
At the same time, the broader Musk ecosystem has expanded dramatically into AI, satellite connectivity and computing infrastructure.
The result is a business model that looks very different from the one Musk originally presented when he acquired Twitter.
Conclusion
SpaceX’s first public earnings report has offered one of the clearest financial snapshots yet of X’s advertising business, revealing that the platform generated approximately $367 million in advertising revenue in Q2 2026. That was an improvement from $343 million in Q1 but a decline from the $426 million recorded in Q2 2025.
More strikingly, the latest number is far below the $1.08 billion in quarterly advertising revenue Twitter reported in Q2 2022, just months before Elon Musk completed his acquisition. Twitter’s official Q2 2022 filing showed $1.08 billion in advertising revenue and $1.18 billion in total revenue.
The comparison represents a decline of roughly 66% in quarterly advertising revenue.
At the Q2 2026 pace, X’s advertising business would generate roughly $1.47 billion annually if the quarter were simply annualised. That is dramatically below the $12 billion annual advertising target associated with Musk’s acquisition-era plans for the late 2020s. Techdirt’s recent analysis specifically cited a $12 billion target for 2027, while other reporting on the 2022 pitch deck placed the same advertising target in 2028.
Either way, the gap is enormous.
The latest figures also show that the advertising business has not completely collapsed. Q2 revenue increased approximately 7% from Q1, suggesting some near-term stabilisation. But the year-on-year decline indicates that X has not yet returned to sustained advertising growth.
The situation becomes more interesting when X is viewed inside the broader SpaceX ecosystem. SpaceX generated $7.8 billion in Q2 2026 revenue, up 92% year-on-year, while Starlink-related connectivity revenue was around $4.3 billion and AI revenue was around $2.6 billion.
That means X advertising is now relatively small compared with SpaceX’s other major businesses.
The strategic importance of X, however, goes beyond its advertising revenue. X provides Musk’s wider ecosystem with a huge distribution platform for Grok, subscriptions, AI services and other digital products. The company can therefore potentially make money from the same users through several different channels rather than relying entirely on advertising.
This is increasingly important because the original Musk-era vision for Twitter was much broader than simply rebuilding its advertising business. It involved growing subscriptions, payments and other services alongside advertising.
The current financial reality suggests that the advertising part of that vision has fallen far short of expectations.
The central question now is whether X can build a sustainable business around its combination of advertising, subscriptions and AI products. If advertising remains around the $1.5-billion annualised level, the company will need other revenue streams to compensate for the enormous gap between its current performance and Musk’s original ambitions.
For advertisers, X still has a valuable asset: its role as a real-time global conversation platform. For Musk, the platform’s biggest future value may increasingly lie not in selling advertisements but in using X as the distribution layer for Grok and the wider AI ecosystem.
The Q2 numbers therefore tell a much larger story than a simple advertising decline. They show the transformation of Twitter from a traditional advertising-driven social network into a smaller advertising business embedded within a much larger SpaceX, xAI and AI-infrastructure ecosystem.
But the numbers also provide a stark reality check on Musk’s original Twitter turnaround promises: from $1.08 billion in quarterly advertising revenue before the acquisition to $367 million today, X’s ad business remains roughly two-thirds smaller than the Twitter business Musk inherited.
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