Twitter ad revenue takes a dive while competition intensifies with Threads, says Musk

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Elon Musk on Twitter Appears to Have Lost His Job
Elon Musk

Twitter advertising revenue has experienced a 50% decline, according to Elon Musk, who attributed it to the platform’s heavy debt load.

According to Forbes, “This comes as competition heats up between Twitter and Mark Zuckerberg’s rival platform, Threads, which has recently started compensating creators for ads.”

The media outlet reported that Elon Musk revealed on Saturday that Twitter’s advertising revenue dropped by an estimated 50%, leading to negative cash flow for the company.

It is noted that in April, Musk stated that Twitter was breaking even as advertisers returned after his acquisition, but a later report from The New York Times indicated a 59% decrease in ad revenue compared to the previous year.

Despite some interest from advertising firms, Threads does not currently host advertisements on its platform and is not directly competing with Twitter for revenue.

Twitter, on the other hand, began paying content creators for posting ads, with some users receiving payouts exceeding $100,000. However, the criteria for eligible posts and users remain unclear, according to reports.

Threads, Meta’s competitor to Twitter, reached an impressive milestone of 100 million users, making it the fastest-growing platform in history.

Sensor Tower data revealed that Threads had the most successful app launch of the past decade, with over 40 million downloads on July 6.

“Despite this achievement, the app experienced a decline in user engagement the following week, with average time spent on the app dropping by 18% between July 7 and July 13.”

In comparison, the average time spent on Twitter during the same period was nearly six times higher.

Twitter plans to pay creators a total of $5 million in its initial payment block, as shared by Elon Musk. With a net worth of $250.4 billion, Musk currently holds the title of the world’s wealthiest individual, according to Forbes.

In recent news, Twitter’s legal team has threatened to sue Meta over alleged misuse of Twitter’s trade secrets and other intellectual property related to Threads.