New data suggests advertisers continue to shun Elon Musk’s Twitter, as another report states there are now just 550 engineers remaining
Bad news continues for Elon Musk and Twitter, after new data suggested that ad spending on the platform has fallen over 70 percent in December.
Reuters reported that data from an advertising research firm Standard Media Index (SMI) showed that top advertisers are continuing to slash their spending on the platform after Elon Musk’s 27 October takeover.
According to the SMI data, ad spending on Twitter in November fell 55 percent from last year despite these months traditionally being a time of higher ad spending due to the holiday season.
Most of the companies had stopped spending in November, estimates by another research firm Pathmatics showed.
Reuters noted that this was the same month that Musk restored suspended accounts and released a paid account verification that resulted in scammers impersonating corporations.
Fourteen of the top 30 advertisers on Twitter stopped all advertising on the platform after Musk took charge on 27 October, according to the Pathmatics estimates.
Musk has previously blamed activist groups for pressuring advertisers to pull ads on the social media platform.
Last week the Information reported that a senior manager at Twitter had told the remaining staff that the company’s daily revenue on Tuesday 17 January was 40 percent lower than the same day a year ago.
And to make matters worse, during the staff meeting Siddharth Rao, an engineering manager overseeing the engineers working on Twitter’s ad business, reportedly told staff in a presentation that more than 500 of Twitter’s top advertisers have paused spending on Twitter since Elon Musk took over in October.
Advertising of course is Twitter’s main source of revenue, accounting for 90 percent of its $5.1bn turnover in 2021.
These reports come after it emerged last week that Twitter is auctioning off its office furniture, as well as its fixtures and fittings from its San Francisco headquarters.
It has been previously reported that Twitter is confronting a revenue crisis, after advertisers including General Motors and Pfizer, paused spending amid fears of a rise in divisive content on the platform.
Corporate advertisers fled in response to Musk’s botched relaunch of Twitter’s paid verification feature, that resulted in scammers impersonating companies on Twitter.
That said, some advertisers have reportedly reinstated their advertising spend on the platform.
And Twitter and Elon Musk not standing idly by, and they are trying to generate new revenue streams, and also attract advertisers back to the platform.
This includes offering free ad space to corporate brands that will advertise on its platform, lifting a ban on political advertising, and allowing companies greater control over the positioning of their ads.
Elon Musk said over the weekend he plans to introduce an ad-free subscription service, as the company looks for new revenue streams.
Musk has previously raised the possibility of the platform going bankrupt during his first mass email with the platform’s remaining staff.
A sign of financial strain at Twitter emerged recently when a landlord in San Francisco sued Twitter over failing to pay rent on its headquarters in the city.
Twitter has also been sued for failing to pay for two charter flights.
Meanwhile after a media report last week suggested that Twitter planned to lay off 50 workers in the platform’s product division, CNBC has reported (citing internal records), that Twitter has shed about 80 percent of its staff since Elon Musk took over.
It reported that Twitter’s headcount is now hovering at 1,300 active working employees.
Even worse, CNBC noted that Twitter now has fewer than 550 full-time engineers, and one former Twitter engineer reportedly said the remaining team will be spread thin, and will likely have a hard time maintaining the service while adding new features.
Musk has reportedly sought to shore up staff numbers by authoritising about 130 people from his other companies, including Tesla, SpaceX and The Boring Co., to work for the social media business.
According to CNBC, Twitter’s trust and safety team, which makes policy recommendations, design and product changes with the aim of keeping all of Twitter’s users safe, is down to fewer than 20 full-time employees.
CNBC said that internal records indicate that there are also about 1,400 non-working employees of Twitter who are still being paid, but are no longer expected to fulfill their old responsibilities at the firm.
Many of them resigned when CEO Elon Musk sent out a “pledge” asking them to commit to “hardcore” work at Twitter 2.0 including long hours.
However Musk has contradicted the internal records obtained by CNBC in a series of tweets, and claimed that Twitter now has about 2,300 full-time working employees and thousands of contractors.
The note is incorrect. There are ~2300 active, working employees at Twitter.
There are still hundreds of employees working on trust & safety, along with several thousand contractors.
Less than 10 people from my other companies are working at Twitter.
— Elon Musk (@elonmusk) January 21, 2023