Report that more than 500 advertisers have paused spending with Twitter, and it’s daily revenue is 40 percent down from a year ago
The scale of the challenge facing Elon Musk amid his chaotic acquisition of Twitter may have been revealed in a media report.
According to a report in the Information, a senior manager at Twitter 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.
This development underscores the crisis facing Twitter’s core ads business, according to a person with direct knowledge of the matter.
The drop in the company’s revenue was first reported by technology newsletter Platformer on Tuesday, a publication that has been closely tracking internal developments at Twitter.
Zoë Schiffer is the managing editor at the Platformer, and she tweeted on Tuesday that new owner Elon Musk is due to pay his first giant interest payment on the company at the end of the month.
Tiny scoop: We learned today that Twitter’s revenue is down 40 percent year over year (& Musk’s first giant interest payment on the company is due at the end of the month): https://t.co/IH7lJiQ0Dw
— Zoë Schiffer (@ZoeSchiffer) January 18, 2023
This latest report that Twitter’s daily advertising revenue is down 40 percent will not help ease the sense of crisis that has engulfed the platform since Musk’s takeover.
This week it has emerged that Twitter is auctioning off its office furniture, as well as its fixtures and fittings from its San Francisco headquarters.
Earlier it was reported that Twitter is offering free ad space to corporate brands that will advertise on its platform.
Twitter is said to be touting free ad space by offering to match advertisers’ ad spending up to $250,000.
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.
But research firm Pathmatics has previously noted that about 70 percent of Twitter’s top 100 advertising clients were not spending on the platform as of mid-December.
Not paying rent
In November Musk 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.