Twitter’s Ad Revenue Plummets 59 Percent Year-on-Year
According to The New York Times, Twitter has experienced a 59 percent decrease in advertising revenue over a five-week period from April 1st to early May compared to the same time frame in the previous year. The company has consistently failed to meet sales projections, and despite the appointment of new CEO Linda Yaccarino, Twitter employees and documents suggest that this trend is unlikely to change in the near future.
Musk has previously said Twitter is on track to generate $3 billion in revenue in 2023, up from $5.1 billion in 2021. Last March, he said Twitter was worth $20 billion, less than half of the $44 billion it paid.
Musk said on Twitter Space last week that “half of our ads” have disappeared, blaming advertisers in Europe and North America who pushed the company “too much.” “They’re trying to bankrupt Twitter,” he added.
However, Twitter’s ad sellers are concerned that advertisers are being scared off by the rise of hate speech and pornography, as well as the abundance of ads for things like online gambling and marijuana products. Since taking over Twitter, Musk has taken steps like firing key sales executives and bringing back banned users. This caused advertising agencies and brands such as General Motors and Volkswagen to suspend their ad spending.
Employees told The New York Times that other advertisers, including Apple, Amazon and Disney, are spending less on ads than last year. He cited the example of large banner ads used to promote things like new events or movies (which can cost up to $500,000 for 24 hours) that didn’t sell. The six agencies said clients had limited advertising spending on Twitter because of inconsistent support, confusion over the changes, and misinformation and toxic content.
They are also concerned about Musk’s tweets, such as one in which billionaire George Soros — often the target of anti-Semitism — was compared to X-Men comic book character Magneto. Earlier this month, Twitter’s director of security and content management, Ella Irwin, left the company after the previous person in the role, Yoel Roth, left in November 2022.
But it’s not all bad news, as some top media buyers recently advised clients to return to Twitter, the report said. When Linda Iaccarino was named CEO last month, Musk said she would “primarily focus on the business, while I focus on product design and new technology.” It could also help Twitter ease troubled relationships with advertisers and address issues related to curbing hate speech, pornography and more.
– For a while, we weren’t even sure who we were talking to on the phone, one media executive told the New York Times. “When Linda comes in, it can make a big difference.” At the same time, he acknowledged that Yaccarino may find it “difficult” to deal with the volatile environment Musk has created.
