Elon Musk says Twitter has had a ‘huge’ drop in revenue as advertisers pause spending

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Elon Musk, founder and chief engineer of SpaceX, speaks at the Satellite 2020 conference in Washington, DC, United States on March 9, 2020.

Yasin Ozturk | Anadolu Agency | Getty Images

Twitter has suffered a “massive drop in revenue” as advertisers cut spending on the social media platform, Elon Musk, the company’s new owner, said Friday without providing any figures.

In a tweet, Musk blamed “activist groups who pressure advertisers.” He said Twitter has not changed its content moderation strategy, adding that the company has done “everything to appease the activists”.

Musk did not specify how much revenue the company lost from the slump, or how he could attribute that loss to pressure from activist groups.

Musk reiterated his views in an interview at the Baron Investment Conference on Friday.

“We haven’t changed our operations at all,” Musk said at the event. “And we’ve gone out of our way to appease them and nothing is working. So this is a big concern. And I think frankly this is an attack on the First Amendment.”

Twitter has fired or laid off about 50% of its employees since it took over on October 28.

In recent days, a number of companies have said that they are temporarily pause their ad spend on Twitter to see how things would change there under Musk’s ownership. Tesla competitors General engines and Audi, and food titan General Mills are among the companies that have paused Twitter spending. Advertising giant IPG advised clients to temporarily suspend their Twitter media plans, although it is unclear how many clients follow the advice of IPG agencies.

Twitter informed employees Thursday evening that it would lay off staff, according to reports obtained by CNBC. Twitter’s content moderation team is expected to be one of those job losses, Reuters reported, citing tweets from employees.

CNBC has also learned that major cuts have been made to Twitter’s global marketing team, which handles reporting and statistics on ad performance, sales performance and spam, among other things.

Earlier this week, Musk, who now serves as Twitter CEO and calls himself “Chief Twit,” met with a group of civil society leaders to address concerns about hate speech and election-related misinformation on the platform.

Since Musk took over, online trolls and bigots have raided Twitter, and hate speech has soared on the platform. Musk also tweeted an unfounded and anti-LGBTQ conspiracy theory about a home invasion and attack on Paul Pelosi, husband of Speaker of the House Nancy Pelosi.

Some of the organizations represented in Tuesday’s Zoom call have now co-signed an open letter to top Twitter advertisers urging them to suspend their ad spend if Musk violates security standards and community guidelines. the company does not maintain.

Despite Musk’s claims of a recent drop in revenue, Twitter’s ad spend had fallen before Musk acquired the company and before civil society organizations began to pressure brands, according to ad analytics platform MediaRadar.

Twitter ad clients increased between April and May, around the time Musk’s plan to take Twitter private was announced, before it started to decline, according to data from MediaRadar. But the average number of advertisers on the platform dropped from 3,900 in May to 2,300 in August. In September, it had 2,900 advertisers.



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