Advertising spending on Elon Musk's Twitter plummets as top advertisers slashed advertising

According to statistics from an advertising research company, prominent advertisers cut down on their spending on the social media platform after Elon Musk's Twitter takeover, causing a 71% decrease in advertising expenditure on Twitter Inc. in December.

The latest data from Standard Media Index (SMI) comes as Twitter works to stop the migration of advertisers. To win back advertisers, it has launched several programs, including some free advertisements, the easing of a restriction on political advertising, and giving businesses more discretion over the placement of their commercials.

Despite these months often being a period of increased ad expenditure as firms advertise their products over the holiday season, according to the SMI data, ad spending on Twitter in November decreased by 55% from the previous year.

According to estimates from another research firm Pathmatics, the majority of the enterprises had halted spending in November, the same month that Musk reinstated suspended accounts and offered a paid account verification that led to con artists posing as businesses.

According to Pathmatics estimates, 14 of the top 30 Twitter advertisers suspended all advertising on the service when Musk assumed leadership on October 27.

Musk addressed the problem of businesses halting advertisements in a Twitter Spaces event in November and said he understood if marketers "want to give it a minute."

Musk has also accused activist organizations of pressing advertisers to stop running advertising on social media platforms around the same period. About 90% of Twitter's revenue comes from ad revenues.

According to information presented at a staff meeting last week by a top Twitter ad executive, the company's fourth-quarter income decreased by around 35% year over year as a result of a decline in advertising.