Elon Musk’s social network, X (formerly Twitter), is struggling with an ad boycott after Musk’s blunt response to advertisers pulling out, telling them to “go fuck yourself.” This bold stance is risky, given that X previously relied on ads for 90% of its revenue. Major brands like Apple and Disney have left, concerned about increased harmful content due to reduced moderation after Musk fired 80% of the staff.
Unlike Facebook, which has millions of small advertisers, X depends heavily on big brands. When Musk bought Twitter, the top 100 advertisers accounted for 70% of its U.S. ad sales; half of them have since left. This has led to a 60% drop in X’s American ad revenue. While X still has many users, the number of monthly users has declined by 15%.
To compensate, Musk is pushing X Premium, a subscription service, but it has only generated $60 million, about 1% of pre-Musk ad sales. Musk also envisions X as an “everything app,” but this is a long-term goal. For now, X aims to attract small advertisers to offset the loss of big ones. If ad sales continue to fall, X might need a bailout from investors or Musk himself. The company must quickly enhance its appeal to advertisers to survive.
