25th November 2023 – (New York) X, formerly known as Twitter, typically enjoys robust earnings in the final months of the year when brands intensify their advertising efforts for the holiday shopping season. However, The New York Times reports that the company’s upcoming earnings report for this quarter may deviate from the norm. Internal documents obtained by The Times reveal that more than 100 brands, including political candidates, have completely halted their ads on the platform, while several others are contemplating withdrawing their campaigns. If advertisers fail to return, X stands to lose up to $75 million in ad revenue earnings this year.
According to the documents, which assess the impact of brands leaving the platform, the initial wave of ad suspensions occurred shortly after Elon Musk’s controversial tweet, in which he endorsed an anti-Semitic conspiracy theory. Media watchdog Media Matters subsequently published a report illustrating ads displayed alongside anti-Semitic content on X’s website. In response, X filed a lawsuit against Media Matters, accusing the organization of intentionally juxtaposing advertisers’ posts with neo-Nazi and white nationalist fringe content.
X’s complaint contends that Media Matters deliberately engineered an environment where ads from prominent advertisers appeared alongside “extreme, fringe content.” Linda Yaccarino, CEO of X, defended the platform in a statement, asserting that only two users, one of them being Media Matters, witnessed Apple’s advertisement adjacent to objectionable material. Media Matters dismissed X’s lawsuit as “frivolous” and expressed confidence in prevailing in court, according to a statement provided to Engadget.
Following these incidents, brands such as IBM, Apple, and Disney swiftly suspended their ads on X. Lionsgate specifically cited Musk’s tweet as the reason behind its advertising campaign suspension, while Ubisoft became one of the first video game companies to withdraw its ads from the platform. The Times’ report indicates that Airbnb has paused over $1 million worth of advertising on X, while Netflix has pulled $3 million in ads. Moreover, X faces a potential loss of $4 million in ad revenue due to Microsoft’s subsidiaries pausing their campaigns. Notably, well-known brands like Uber and Coca-Cola have also chosen to halt their advertising on X.
In response to the publication’s findings, X stated that the figures observed were either outdated or represented an internal evaluation of total risk. The company further claimed that the revenue at risk amounted to only around $11 million, noting that the exact amount fluctuates as advertisers either return or increase their ad spending.