Internal forecasts at Twitter reportedly show that the social media company’s ad sales will keep declining, and that it is unlikely to improve anytime soon. The New York Times has reported that Elon Musk’s social media company has suffered a 59 percent drop in ad sales year over year.
While Elon Musk says Twitter’s advertisers are coming back, the social media company’s U.S. advertising revenue for the five weeks from April 1 to the first week of May was $88 million, down 59 percent from last year, according to an internal presentation obtained by the New York Times.
The documents also noted that Twitter regularly falls short of its U.S. weekly sales projections — and sometimes by as much as 30 percent.
Seven current and former Twitter employees who spoke to Times expressed that the company’s ad sales staff is worried that advertisers may be spooked by a rise in free speech and pornography on the platform, as well as the increase in gambling and marijuana ads.
In one week last month, for example, four of Twitter’s top ten U.S. advertisers were online gambling and fantasy sports betting companies, one internal presentation showed.
Meanwhile, Twitter has forecast that its U.S. ad revenue this month will be down at least 56 percent each week compared with its numbers last year, the internal document also revealed.
Several large ad agencies and brands, such as General Motors and Volkswagen, reportedly halted their ad spending on Twitter in response to Musk firing executives and allowing previously banned users back onto the platform.
Those familiar with the situation also told Times that some of Twitter’s biggest advertisers, such as Apple, Amazon, and Disney, have been spending less on the platform than last year.
In March, a leaked memo revealed that Twitter was worth $20 billion, which is down more than 50 percent from the $44 billion Elon Musk paid for it. Last week, Fidelity valued the social media company at $15 billion.
The company’s advertising numbers are crucial because for a long time, ads have been making up 90 percent of Twitter’s revenue, New York Times noted.
These problems will soon be something Linda Yaccarino — Twitter’s new CEO who is expected to start the job today — will have to deal with.