Here’s how much Twitter lost in advertising revenue during the final months of 2022

Richa Naidu & Jessica DiNapoli

NEW YORK/LONDON – Twitter’s top marketers cut their spending after Elon Musk tookover, according estimates by Pathmatics. This was the latest shock for the company’s main revenue source.

According to Pathmatics estimates that 14 of the top 30 Twitter advertisers have stopped using Twitter advertising since Musk’s takeover on October 27. From the week before Musk’s acquisition, through the end the year, four advertisers saw their spending drop between 92% to 98.7%.

Pathmatics reported that overall advertising spending by the top thirty companies decreased by 42% to $53.8million for November and December. This is despite an increase by six of them.

Pathmatics stated that the previously unknown figures for Twitter advertising are only estimates. It uses technologies that track ads on desktop browsers, the Twitter app, and those that imitate user experience to calculate its estimates.

The company clarified that those estimates don’t include deals advertisers may get from Twitter, as well as promoted trends or accounts. Pathmatics stated via email that “it is possible that the spending data could have been higher for some brands”, if Twitter is offering incentives.

Twitter declined to respond to multiple requests.

Musk spoke out at a November Twitter Spaces conference and addressed the issue about companies allowing ads to pause. He said that Twitter was the best way for him to “see how things are changing at Twitter”.

The Information, a technology-focused publication, reported details from a top Twitter ad executive who shared information at a staff meeting Wednesday. The report said that Twitter’s fourth quarter revenues fell by 35% year over the previous year due to a slump of advertising.

Twitter lost $270 million during the three-month period ended June 30, and had a total revenue of approximately $1.18billion.

Pathmatics estimates indicate that Twitter’s main revenue stream will continue to fluctuate through 2023, primarily due to a pullback by top consumer brands.

According to Standard Media Index research, forward bookings or agreements to lock into future ads were also lower for January and February. The firm did not provide further details.

Twitter is working to reverse the exodus of advertisers. Twitter is introducing a variety of initiatives to win back advertiser support. It offers free ads, lifts the ban on political ads and gives companies greater control over where their ads are placed.

“They’re truly incredible incentives. Molly Lopez, owner and CEO of HITE Digital Miami, stated that she has never seen such an incentive from any advertiser.

Mark DiMassimo, the founder of DiMassimo Goldstein in New York, stated that bargain-price direct marketers and political action groups – large spenders on Meta Platform Inc’s Facebook – may be able to fill the advertising gap.

Coca-Cola Co cut back spending after buying an estimated $1.1 Million in Twitter ads. In contrast, HBO spending fell to about $38,000 in December from approximately $1.1M in November, Pathmatics reported.

Coca-Cola declined comment. Chris Willard, spokesperson at HBO, did not comment on details of advertising spending but stated that they would be “evaluating the platform under its new leadership to determine appropriate next steps.”

According to Pathmatics estimates, Heinz ketchup maker Kraft Heinz Co. and Stouffers meal producer Nestle SA have stopped advertising. Heinz, Nestle and others declined to comment.

Target Corp, a major retailer of mass merchandise, and Kohls Corp were also absent from advertising on Twitter on Black Friday. It is the largest shopping day of the year. Kohls didn’t respond to our requests for comment.

Pathmatics reports that spending increased at Apple Inc. and PepsiCo Inc.

Apple declined to comment on requests. PepsiCo declined comment.

SmartAsset, a financial technology company, and Amazon.com Inc claimed that Pathmatics estimates of an increase in advertising were incorrect. SmartAsset stated that the figures were “inflated”, but Amazon didn’t provide further details. Pathmatics stated, “We want to reiterate that our numbers are only estimates.”

BRAND SAFETY

Musk’s appearance on Twitter has exacerbated a drop of advertising that started in September, after Reuters reported promotions were appearing alongside tweets soliciting child pornography.

According to estimates, most companies stopped spending in November. Musk also released an estimated paid account verification and restored suspended accounts. This led to scammers impersonating corporations.

Telecommunications company AT&T Inc and pet food provider Mars Inc slashed spending in September due to concerns about brand safety.

Pathmatics says that even though companies were pulling back on Twitter in some cases, they kept and sometimes increased advertising on Meta Platform Inc’s Instagram and Facebook as well as on TikTok short video app TikTok.

Meta and TikTok didn’t immediately respond to requests for comment.

GRAPHIC: Some advertisers cut spending or leave Twitter after Musk’s takeover (https://www.reuters.com/graphics/TWITTER-ADVERTISERS/TWITTER-ADVERTISERS-SPENDING/dwpkdadqrvm/graphic.jpg)

AT&T said it paused advertising in September because of “concerns around content appearing next” to its ads. The company has been talking to Twitter about its concerns, according to a person familiar with AT&T’s thinking.

Mars stated that its “suspension is still in effect.”

Twitter told Reuters that it is investing in child safety. Twitter is using automation to control content, limit abuse-prone hashtags, and search results that include child exploitation.

Companies also reduced their tweeting. According to a Reuters review, Target and Special K cereal maker Kellogg Co had not tweeted since October. Coca-Cola and electronics retailer Best Buy Co Inc stopped tweeting in November according to a Reuters analysis of their main feeds.

Target, Best Buy and Kellogg have not returned requests for comment.

(Reporting by Jessica DiNapoli and Richa Naidu in London; additional reports by Sheila Dang and Suzanne Goldenberg in Dallas; Editing done by Vanessa O’Connell, Suzanne Goldenberg).