X CEO Linda Yaccarino stated this week that she is leaving the company after a rocky two years.
She will leave behind an ad business that is still struggling — around half the size it was before Elon Musk purchased the platform formerly known as Twitter in October 2022. However, for the first time in years, growth may be on the way.
According to eMarketer, the company produced $4.46 billion in worldwide advertising revenue in 2021 and $4.1 billion in 2022. Revenue fell to $2 billion in 2023, a 51.7% drop since Musk’s takeover. It fell again last year to $1.94 billion.
Now, eMarketer expects X’s advertising business to expand to $2.26 billion this year, a 16.5% increase — the first time it has grown since Musk purchased X, but still less than half of its pre-Musk ad income.
However, X continues to lose users, with eMarketer projecting a 3.8% drop this year.
Since Musk acquired the social site, its relationship with advertisers has been strained. During The New York Times’ DealBook conference in November 2023, he infamously advised advertisers to “go f— yourself,” blaming a “advertising boycott” on X.
He backed up his claims last year by filing an antitrust lawsuit against some advertisers affiliated with the Global Alliance for Responsible Media (GARM), which later ceased operations, citing that the lawsuit “caused a distraction and significantly drained its resources and finances.”
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Yaccarino supported Musk’s claims; in an open letter last year, she wrote, in part: “People are hurt when the marketplace of ideas is undermined, and some viewpoints are not funded over others as part of an illegal boycott.”
Despite Musk’s scorched-earth approach, some well-known brands have returned to X following an advertising freeze, but they are spending significantly less than before.
From January to September 2024, the platform’s former top five advertisers spent less than $3.3 million on X, a 98% decrease year on year, according to MediaRadar statistics published by Adweek. According to the research, some new, smaller firms began advertising on X to take advantage of a less competitive market.
Yaccarino’s departure comes just two weeks after the Federal Trade Commission approved the Omnicom-IPG merger on the condition that the new company not engage “in collusion or coordination to direct advertising away from media publishers based on the publishers’ political or ideological viewpoints.”
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