Twitter Revenues Collapse: Advertisers Are Abandoning the Platform
After Elon Musk bought Twitter, most of the advertisers on the platform left the platform. 7 out of 10 advertisers have left the platform.
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After Elon Musk’s acquisition of the Twitter platform, advertisers began withdrawing their support, and revenue plummeted almost 40%, according to The Wall Street Journal sources familiar with the circumstance. Twitter officially reported this year-over-year decline in earnings via a statement sent out to investors. To repay the $13 billion debt incurred from Musk’s purchase, yearly interest payments as high as $1 billion are required – an overwhelming task for any company!
70% of Major Advertisers Abandoned the Platform
After Elon Musk bought the app in October 2022, advertisers rapidly deserted Twitter. Pathmatics’ research firm reported that 70 out of 100 main advertisers had ceased spending on the platform since February 25th. Reports by The Wall Street Journal indicated that these companies feared their ads would be located near questionable content and thus decided to leave the application altogether.
Recognizing that advertising accounts for a huge share of its revenue, Twitter has made several attempts to attract these lucrative customers back. This includes an offer of free ad space and up to $250,000 in spending match on promoted ads during the Super Bowl, as The Wall Street Journal reported. In 2021 alone, this accounted for approximately $4.5 billion out of Twitter’s total earnings amounting to $5.1 billion!
Elon Musk Tries Different Things To Increase Twitter’s Revenue
To generate more income for the platform, Musk rolled out Twitter Blue in November – a subscription service allowing users access to exclusive content and edit tweets. Sadly, this was overshadowed by people creating fraudulent accounts pretending to be prominent figures such as Lockheed Martin, former President George W Bush, and Eli Lilly pharmaceuticals.
Elon Musk has made the difficult decision to cut thousands of jobs to drastically reduce costs. As of December 2022, Twitter’s workforce had been reduced by a staggering 6,000 employees – as initially reported in The Wall Street Journal. Just last weekend (Feb 24th), another round of layoffs occurred; however, no numbers have been officially released to the public yet.
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