"Tweetstorm Fallout: Twitter's Advertising Revenue Plummets by Almost Half Amid Elon Musk's Takeover"

Twitter's Advertising Revenue Plummets by Almost Half under Elon Musk's Ownership, Cost-Cutting Measures Fail to Attract Advertisers

 – In a shocking revelation, Twitter announced today that its advertising revenue has experienced a staggering drop of nearly 50% since being acquired by Elon Musk for a whopping $44 billion (£33.6bn) in October last year. The owner disclosed that the company did not witness the anticipated surge in receipts during June, although July shows some signs of improvement.

Musk's acquisition strategy included laying off approximately half of Twitter's workforce, reducing it to 7,500 employees, as part of a stringent cost-cutting initiative implemented in 2022.

As Twitter grapples with a significant decline in ad revenue, rival app Threads has gained momentum, boasting an estimated user base of 150 million. The app's built-in integration with Instagram, which provides access to a potential two billion users, has contributed to its swift rise.

In contrast, Twitter's competitor struggles under the weight of a substantial debt burden. Mr. Musk, however, did not specify a timeline for the 50% drop in ad revenue, but acknowledged that cash flow remains negative. Taking to Twitter, Musk expressed the need to achieve positive cash flow as a prerequisite before addressing other luxuries.

Despite the implementation of aggressive cost-cutting measures, which included substantial employee layoffs and reductions in cloud service expenses, Musk stated that Twitter is on track to generate $3 billion (£2.29bn) in revenue in 2023, a significant decline from the $5.1 billion (£3.89bn) recorded in 2021.

This latest development underscores the challenges Twitter faces in enticing back advertisers who departed after alterations to the platform's content moderation rules. Despite a previous interview with the BBC where the former CEO suggested a majority of advertisers had returned, the reality appears starkly different.

The restriction on the number of tweets users can read has added to Twitter's woes. In a recent move, the platform decided to limit unverified users to 1,000 tweets per day, while verified users can access up to 10,000 tweets per day. Advertising executives have expressed bewilderment at this decision, as efforts are simultaneously made to encourage users to embrace Twitter Blue, the platform's paid subscription service.

To navigate these challenges and prioritize advertising sales, Twitter appointed Linda Yaccarino as CEO in June. Yaccarino, renowned for her previous role as head of advertising at NBCUniversal, aims to steer Twitter towards video, creator, and commerce partnerships. The platform is reportedly engaged in early discussions with political and entertainment figures, payments services, news organizations, and media publishers.

As Twitter continues to grapple with a substantial decline in advertising revenue, industry observers eagerly await the next steps and strategies the platform will employ to revitalize its fortunes and regain the confidence of advertisers.

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