Twitter is facing a significant blow due to the fall in its U.S. advertising revenue. According to internal documents obtained by The New York Times, Twitter’s U.S. advertising revenue for the five weeks from April 1 to the first week of May fell by 59% from the previous year, amounting to $88 million. The company’s ad sales staff are reportedly concerned that advertisers may be afraid to advertise on Twitter as it contains an increase in hate speech, online gambling, marijuana products and pornographic content. Furthermore, the company is projected to experience a downturn of at least 56% in its U.S. ad revenue for this month compared to a year ago. The situation is unlikely to improve anytime soon, and seven current and former Twitter employees are worried about the negative impact on the company. This is particularly important since ads usually generate 90% of Twitter’s revenue.
Recently, Twitter has been reeling from PR blunders with huge advertisers such as Disney. Some of Twitter’s biggest advertisers, including Apple, Amazon, and Disney, are reportedly spending less on the platform than last year.
In response to the decline, Linda Yaccarino, a NBCUniversal executive, has been hired as Twitter’s chief executive. Her task will be to address the ads’ situation and restore the clean image of the platform, which would attract advertisers. Twitter is now exploring more ways to make it easy for advertisers to buy space on the platform by testing an automated system outside the United States to make deals.
Although Ms. Yaccarino may bring positive changes to Twitter, her task is challenging, given the mercurial boss and a volatile marketplace. Payment of Twitter’s $44 billion acquisition by Elon Musk resulted in a decline in the company’s valuation.
