Days after Elon Musk bought X for $44 billion last year, he strolled through the glass doors at company headquarters carrying a kitchen sink. However, Musk now faces a difficult reality as the value of X has sharply declined, resulting in tens of billions of dollars in losses.

This revelation has raised the question of whether Musk would consider selling the struggling asset. Experts have pointed to ongoing obstacles such as an advertiser boycott and the burden of debt payments that may make a sale an attractive option.

However, experts also speculate that Musk is unlikely to pursue a sale. They believe that economic incentives seem secondary to him, and any sale could be seen as conceding defeat. Additionally, the substantial losses have put Musk in a weaker position, making it challenging to offload the ailing asset.

An analysis of earnings reports prior to the acquisition showed that advertising sales constituted the majority of X's income. However, since Musk took over the company, advertising revenue has plummeted by around 50%, as revealed in a post on X in July.

This decline occurred even before a wave of ad exits in November, prompted by an antisemitic remark made by Musk. Advertisers such as Comcast, IBM, Warner Bros. Discovery, and Disney, the parent company of ABC News, withdrew their support from the platform.

While Musk apologized for his post, he also crudely denounced the departing advertisers and expressed a disinclination towards their return. The loss of these significant advertisers only exacerbated the growing financial challenges faced by X.

Ann Lipton, a professor at Tulane University specializing in corporate law, commented on the uncertainty surrounding a potential sale, stating, "It's very hard to say whether he'd be willing to sell, and that's because it's not obvious to me he's behaving as an economic actor. He might view a sale at a discount as something like an admission of failure."

Paul Barrett, a professor at New York University Law School and deputy director of the NYU Stern Center for Business and Human Rights, echoed this sentiment, emphasizing the blow to Musk's ego that selling X at its current reduced value would represent.

Despite these reservations, some experts believe that Musk may opt for a partial sale this year to raise funds for expanding the platform's capabilities. To purchase X, Musk initially borrowed approximately $12.5 billion from major lenders such as Morgan Stanley, Bank of America, and Barclays. While Musk has made significant payments on this debt, dwindling revenues have forced him to consider renegotiating the loan terms, as noted by Talley.

Facing existential risks, Musk acknowledged at a conference in November that the company's future is uncertain but affirmed a readiness to endure the challenges ahead. He even warned that the advertiser boycott might spell the demise of the company, vowing to document the role played by those advertisers in its downfall.

As the situation unfolds, stakeholders will be watching closely to see how Musk navigates these obstacles and determines the future trajectory of X.