published : 2023-11-26
Elon Musk's X Faces Potential $75 Million Ad Revenue Loss Amidst Content Moderation Backlash
Advertisers hesitate to spend on X amid concerns over content moderation policies
Elon Musk's social media platform, X (formerly known as Twitter), is at risk of losing up to $75 million in advertising revenue by the end of the year, as major brands are pausing their spending on the platform.
According to a report by the New York Times, internal documents from X revealed that over 200 ad units of major brands like Airbnb, Amazon, Coca-Cola, and Microsoft have either halted or considered pausing advertising on the platform.
X stated that $11 million in revenue was currently at risk, as the figure fluctuates due to some advertisers returning to the platform and others increasing their spending.
However, X has been facing challenges with advertisers due to Musk's cuts to content moderation since his ownership group acquired the company and took it private in a $44 billion deal last year.
Worsening the situation was a report by left-wing group Media Matters, alleging that X ran ads for major brands alongside pro-Nazi posts and other antisemitic content.
IBM, Apple, and Lionsgate Entertainment were among the brands that paused their advertising on X following the controversy.
An executive at X clarified that the platform's system was not intentionally placing brands next to such content and that control settings are in place for users and brands alike.
In response to the controversy, X filed a lawsuit against Media Matters, accusing them of defaming the platform and manipulating the algorithm to place ads near antisemitic content.
Despite the challenges and allegations, Musk has pushed back on claims of antisemitism and has expressed his commitment to supporting hospitals in Israel and the Red Cross in Gaza.
Last week, Musk engaged in a feud with the Anti-Defamation League (ADL) over their claims of rampant antisemitism on X.
Musk's trip to Israel is reportedly planned as he aims to disprove allegations of antisemitism and reiterate his support for a prosperous future for all of humanity.
X has not yet responded to requests for comment regarding the situation.
It remains to be seen how the ongoing content moderation backlash will impact X's advertising revenue and future prospects.