When Elon Musk acquired Twitter for $44B in 2022 and rebranded it as X in 2023, advertisers fled the platform faster than users could tweet “Elongone.” Now, internal documents seen by The New York Times reveal just how much the exodus has cost X — with this year’s second-quarter revenue plunging 53% year-over-year to a paltry $114M. That’s left new CEO Linda Yaccarino, hired from NBCUniversalCMCSA

, facing a Herculean task in trying to woo back wary brands while contending with Musk’s unpredictable behaviour.

Yaccarino’s charm offensive: The veteran ad exec hit the ground running, renegotiating contracts, settling unpaid bills, and unveiling new brand safety tools to ease advertisers’ concerns about their ads appearing next to toxic content. Her efforts showed some early promise, with X execs claiming 65% of brands that left have since returned — albeit at reduced spending levels.

• X aims to reach $190M in Q3 US revenue, which would still be down 25% from Q3 2023.
• Yaccarino scored a win by convincing Condé Nast to keep spending tens of millions on X ads annually, despite the publisher’s concerns.

Musk’s Minefield of Mayhem

For every step forward Yaccarino takes, Musk seems to pull X two steps back with his erratic antics and inflammatory posts. He’s publicly told advertisers to take their business elsewhere, promoted antisemitic conspiracy theories, and engaged in an ugly feud with the Anti-Defamation League — all undermining Yaccarino’s efforts to sanitize X’s brand image.

• In June 2023, Musk replied approvingly to an antisemitic post on X, right after Yaccarino had assured advertisers X would fight hate speech.
• At a Nov. 2023 conference, with Yaccarino in the audience, Musk went on an expletive-laden rant against advertisers. The next day, she made him attend a dinner to smooth things over.

Advertiser anxiety lingers: Many brands remain hesitant to return to X, fearing Musk’s penchant for controversy could tarnish them by association. Advocacy groups have called out an increase in hate speech and misinformation on the platform since his takeover. Yaccarino has tried to defend Musk at times, but is clearly struggling to rein him in. With the 2024 presidential race heating up, X’s plan to host candidate events and take political ad dollars could inject even more volatility.