Twitter’s advertising business, once worth $4.5 billion, is facing a major decline as more than half of the top 1,000 advertisers in September have pulled their ad dollars from the platform following Elon Musk’s acquisition of the company. According to data from digital marketing analytics firm Pathmatics, around 625 of Twitter’s top advertisers, including major brands like Coca-Cola, Unilever, Jeep and Merck, have stopped advertising on the platform.
The decline in ad revenue is significant, with monthly revenue from Twitter’s top 1,000 advertisers falling by more than 60% from October to January 25, dropping from $127 million to just over $48 million. The sharpest decline has come from the 30 largest advertisers in September and October, whose total spending deflated from $62.5 million in October 2022 to roughly $15 million in January 2023.
The loss of ad revenue is due to advertisers’ concerns about the platform’s security and stability following Musk’s takeover, as well as plans to cut staff and relax content moderation policies. Despite being smaller than competitors Facebook and Google, Twitter’s ad business was still responsible for the majority of the company’s revenue.
While some top advertisers, such as ESPN, Salesforce and Apple, have increased their ad spending on the platform, many others, including HBO, have dramatically reduced their ad spending. HBO, which was Twitter’s top advertiser in September, spent nearly $12 million on ads that month, but for the month of January (as of January 25), it spent just over $54,000.
The decline in ad revenue puts pressure on Elon Musk as he faces interest payments on the debt he took on to buy Twitter for $44 billion. Twitter remains reliant on advertising revenue as it struggles to grow its paid subscriber base.
Source: CNN
