The Social Media Platform War: Betting on Market Dominance Between X and Threads

The battle for social media supremacy is intensifying, with Meta's Threads and Elon Musk's X (formerly Twitter) locked in a high-stakes rivalry. While X retains web dominance, Threads is rapidly closing the gap on mobile—and investors must decide where to place their bets. Here's why the scales are tipping toward Meta's upstart platform, and why X's future remains clouded by operational instability and shifting user preferences.

The Mobile Web Divide: Threads' Assault on X's Fortress

Threads' ascent is undeniable. By June 2025, it had amassed 115.1 million daily active mobile users, a 127.8% year-over-year surge, while X's mobile user base shrank by 15.2% to 132 million. The disparity is stark: Threads is now within striking distance of X on mobile, its core battleground.

But the web remains X's domain. In June 2025, X attracted 145.8 million daily web visits globally, compared to Threads' meager 6.9 million. In the U.S., X's web traffic was 33.1 million daily visits, dwarfing Threads' 985,000. This divide highlights Threads' mobile-first focus and X's reliance on a shrinking web audience—a critical vulnerability as users increasingly favor apps over browsers.

Monetization: Threads' Coming Ad Surge vs. X's Decline

Threads' user growth is a prelude to its monetization showdown with X. Meta plans to introduce ads on Threads by late 2025, leveraging its $20 billion AI investment to target users with precision. Analysts project Threads could generate $11.3 billion in revenue by 2026, directly competing with X's struggling ad business.

X's ad revenue has cratered. In 2024, it fell to $2.5 billion, down 45% from 2022 levels. Even as Threads gains traction, X's advertiser base remains fractured, with only 61% of its 2022 peak returning. Meanwhile, Meta's AI-driven ad ecosystem—already generating $130 billion annually—ensures Threads' ad rollout is a foregone conclusion.

The Musk Factor: How X's Leadership Risks Weigh on Its Value

Elon Musk's dual role as X's chairman/CTO and Tesla's CEO has created operational chaos. Tesla's stock dropped 22% by June 2025, with analysts citing “investor exhaustion” over Musk's distractions, such as his June 2025 “America Party” poll on X.

Musk's focus on political theater and AI ambitions (e.g., merging X with xAI) has diverted resources from X's core issues: stagnant user growth, regulatory battles, and a toxic content environment. Threads, by contrast, prioritizes moderation and user safety, attracting younger demographics (37% aged 18–24) and key markets like Taiwan (18% of its web traffic).

The Risks: Why X's Decline Isn't a Flash in the Pan

X's challenges are structural:
- User Engagement Gaps: Threads' average session duration is 1 minute 41 seconds, far below X's 2 minutes 26 seconds. Yet Threads' 14.9% monthly user growth outpaces X's decline.
- Regulatory Headwinds: The FTC's investigations into X's content policies and bot proliferation could lead to fines or operational constraints.
- AI Hype vs. Reality: X's merger with xAI aims to create an “everything app,” but execution risks—like talent poaching and delayed Grok monetization—are mounting.

Investment Thesis: Bet on Meta, Avoid X's Volatility

Investors should position for Threads' closing gap with X and Meta's sustained growth:
- Buy Meta (META): Its $11.3 billion Threads revenue projection, stable financials (Sharpe Ratio 1.51 vs. Tesla's -0.34), and diversified ecosystem (Instagram, WhatsApp) justify its $661.97 price target.
- Avoid X (TWTR): Its valuation lags Musk's $44 billion buyout price, and its operational instability—exacerbated by political distractions—makes it a high-risk play.

Final Word

The social media war isn't just about users—it's about who can monetize them. Threads' mobile dominance, Meta's AI-driven ad engine, and X's leadership missteps create a clear path forward. For investors, the choice is simple: back the platform that's winning the battle for attention—and the profits that follow.