Ad Revenue On ExTwitter Still In Free Fall In Second Year Of Elon’s Reign

Turns out that when you tell advertisers to go fuck themselves, sue the advertisers who did so, and then promise you won’t do anything to stop the worst people in the world from spewing hate and bigotry on your platform, it might not be great for business.

Who knew? Elon, apparently.

Last week we noted that ad execs were saying that Elon’s latest antics were only making them even less interested in advertising on ExTwitter, but there hasn’t been as much talk lately about the financial situation the company is in.

In the first year after Elon took over, there were a number of reports suggesting ad revenue dropped somewhere between 50% and 70%. Elon has admitted that the company’s overall valuation of the company is probably down by nearly 60%.

But most of that was all talking about where it was in that first year post Elon. Since then, there’s been little data on how things were actually going. Linda Yaccarino has insisted that many of the advertisers who left came back, though when people looked at the details, it looked like a few that had come back only dipped their toes in the ExTwitter waters, rather than fully coming back.

And indeed, all we’ve been hearing this year is that Musk and Yaccarino are trying to woo back advertisers. Again. And again. Though, suing them isn’t doing them any favors.

However, buried in a recent Fortune article is the first time I’ve seen any data showing how badly the second year of Elon has gone. While the main focus of the article is on how Elon may have to sell some more of his Tesla stock to fund ExTwitter, it notes that ad revenue has continued to drop and was 53% lower than it was in 2023 (i.e., already after Elon had taken over, and many advertisers had bailed).

And the article says that ad revenue is down an astounding 84% from when Elon took over, based on an analysis by Bradford Ferguson, the chief investment officer at an asset management firm:

Ferguson based his assessment on internal second-quarter figures recently obtained by the New York Times. According to this report, X booked $114 million worth of revenue in the U.S., its largest market by far. This represented a 25% drop over the preceding three months and a 53% drop over the year-ago period.

That already sounds bad. But it gets worse. The last publicly available figures prior to Musk’s acquisition, from Q2 of 2022, had revenue at $661 million. After you account for inflation, revenue has actually collapsed by 84%, in today’s dollars.

Ouch.

A separate report from Quartz (pulling from MediaRadar research) suggests the numbers aren’t quite that dire, but they still see a 24% decline in 2024 compared to 2023. And when the 24% decline is the better report, you know you’re in serious trouble.

Advertisers apparently spent almost $744 million on X, formerly known as Twitter, during the first six months of 2024. That’s about 24% lower than the more than $982 million advertisers dropped on the platform in the first half of 2023, according to ad-tracking company MediaRadar.

No matter how you look at it, it appears that in the second year of Elon’s control, advertising revenue remains in free fall.

No wonder he’s resorted to suing. Platforming more awful people and undermining each deal that Yaccarino brings in hasn’t magically helped turn things around.

Anyway, for no reason at all, I’ll just remind people that Elon’s pitch to investors to help fund some of the $44 billion takeover of Twitter was that he would increase revenue to $26.4 billion by 2028. And, yes, the plan was to diversify that revenue, but his pitch deck said that ad revenue would generate $12 billion by 2028. This would mean basically doubling the ~$6 billion in ad revenue the company was making at the time Elon purchased it. But now that’s been cut to maybe $1.5 billion and probably less.

I’m guessing that Elon and Linda might fall a wee bit short of their target here.