X's Ad Sales Are Alarmingly Down

A year after Elon Musk bought what was then known as Twitter, the social platform stands as a shell of its former self, with dramatically lower advertising revenue. After pulling in about $1 billion in ad revenue per quarter in 2022, it has managed just $600 million in the first three quarters of this year and, despite a recent advertising exodus, expects a similar performance in Q4, meaning it will likely see about $2.5 billion in total ad revenue for 2023, Bloomberg reports. That's a nearly 40% decline from last year. As ad sales form 70% to 75% of X's total revenue, two sources tell the outlet, the platform's total sales for the year are likely around $3.4 billion. X executives had initially hoped for $3 billion in revenue from advertising and subscriptions in 2023 but won't come close to that, per Bloomberg.

The figures "underscore with greater clarity advertisers' unease with how X is handling content moderation under Musk, and in particular the new owner's posts that amplify antisemitic and other extremist views," per the outlet. Apple, Disney, Comcast, IBM, Warner Bros., and other companies paused spending on the site in November in response to a tweet from Musk. He apologized but told advertisers fleeing the platform to "go f--- yourself." "What the advertising boycott is going to do is it's going to kill the company," he said, per ABC News, claiming it was a form of blackmail. "The whole world will know that those advertisers killed the company and we will document it in great detail." At various points this year, Musk described ad revenue as down 50% or 60%.

But X's head of business operations, Joe Benarroch, says the platform has shifted its focus. X is an "evolving NEW global business with multiple revenue streams," he tells Bloomberg. "We are not Twitter any longer and not measuring ourselves by old Twitter metrics—both in revenue and user metrics." Still, Musk hired Linda Yaccarino, a veteran advertising executive, as CEO in May to convince advertisers who fled following his takeover to return to X, per CBS News. She's "had her hands tied" with "a lot of damage control," New York Times tech reporter Ryan Mac told the outlet late last month. Musk reportedly hopes to see X's subscription service make up 50% of total revenue, but it currently pulls in less than $120 million annually with just over 1 million paying subscribers, per Bloomberg. (More Twitter stories.)