Elon Musk, the owner of social media platform X, told employees that since he acquired the company, formerly known as Twitter, it has been facing “a very dire situation from a revenue standpoint.”Wall Street banks are preparing to sell off some of the $13 billion in debt they loaned Musk to finance his $44 billion acquisition of X, according to The Wall Street Journal. The publication reported that three banks are gearing up to offload up to $3 billion in debt, with a planned sale set for next week.

This follows an email sent to employees earlier this month, which was also confirmed by The Verge, where Musk acknowledged X’s struggle with stagnant user growth and unimpressive revenues. He noted, “We’ve witnessed the power of X in shaping national conversations and outcomes,” but also admitted, “Our user growth is stagnant, revenue is unimpressive, and we’re barely breaking even.”

The sale involves debt tied to Musk’s 2022 purchase of X, with a consortium of banks, including Morgan Stanley, Bank of America, and Barclays, having provided the financing. According to the Wall Street Journal report, banks expect to recover 90 to 95 cents on the dollar through the sale.

Banks typically sell loans tied to acquisitions shortly after the deals are closed, but in this case, offloading X’s debt has been difficult.

Musk’s significant changes to the platform—including widespread layoffs, particularly among content moderation teams—and his own controversial posts have deterred advertisers, hitting revenues. These factors have increased the perceived risk of default, reducing the debt’s value.

In November, Reuters reported that Musk’s rising political influence and ties to former US president Donald Trump had prompted banks to reconsider X’s prospects, potentially easing their ability to sell the debt without incurring substantial losses.Efforts to sell the debt in late 2022 drew bids that would have required banks to take losses of up to 20% on the debt’s face value, sources said.

The consortium of banks that financed the deal also includes Mitsubishi UFJ, BNP Paribas, Mizuho, and Societe Generale.