X has faced a tumultuous period regarding its ad revenue, especially within the United States. According to third-party data sourced by Reuters, monthly U.S. ad revenue has experienced a significant dip of at least 55% year-over-year for each month following Elon Musk’s acquisition of the platform in October 2022.
One of the prominent challenges that emerged post-acquisition was the struggle to maintain a solid advertiser base. Several brands appeared apprehensive about the rapid and often unpredictable changes implemented under Musk’s ownership. In response to this tumultuous period, Linda Yaccarino, X’s Chief Executive, is scheduled to meet with bank lenders this week. These banks had a pivotal role in financing Musk’s acquisition, and the meeting aims to outline X’s business strategies and address concerns brought about by this shift.
The most dramatic drop in U.S. ad revenue occurred in December 2022, marking a staggering 78% decline compared to the previous year’s figures. This sharp decline stands as the most substantial monthly drop since Musk’s acquisition. Data retrieved from ad analytics firm Guideline, which monitors advertising expenditures from major ad agencies, highlights these staggering statistics. Regrettably, X has refrained from providing an official comment on this disheartening data.
Elon Musk himself has recognized the platform’s struggle to maintain its ad revenue. He attributed this downfall to external pressure from activist groups, holding them accountable for influencing advertisers to reconsider their engagement on the platform. In a notable instance, Musk pointed to the Anti-Defamation League (ADL) as the primary force behind a 60% decline in U.S. ad revenue. However, he did not specify the precise time frame for this decline.
Responding to these allegations, the ADL issued a statement refuting any claims that it was responsible for inflicting financial losses on X. The organization went further, expressing its readiness to launch advertising campaigns on the platform. Their aim is to communicate their core message about combatting hate and discrimination to X’s users, emphasizing their mission to contribute positively to the platform’s environment.
In an attempt to regain lost ground, Linda Yaccarino provided a more optimistic outlook. In a recent interview at Vox Media’s Code conference, Yaccarino revealed that 1,500 brands had reinstated their presence on the platform within the past 12 weeks. Furthermore, she disclosed that 90% of the top 100 advertisers had also returned to X. Yaccarino expressed her confidence in the platform’s potential to return to profitability by early next year, signalling a potential turnaround for X amid the turbulent period of change and adaptation.