The barons investment conference is an annual gathering of hedge fund managers, investors and financial experts organized by Baron Capital. The conference has been held for over 30 years and is considered one of the most high-profile investment events. At the latest barons investment conference in 2022, Elon Musk made headlines by admitting that Twitter’s advertising revenue has fallen sharply since he took over the platform. This admission highlighted the challenges Twitter faces in its business model after Musk’s acquisition.
Musk blamed civil rights groups for pressuring advertisers to pull back spending
At the barons investment conference, Elon Musk said Twitter’s revenue has plummeted due to major advertisers suspending spending on the platform. He specifically blamed civil rights organizations for pressuring advertisers, though he did not provide specific revenue figures. Activist groups had reportedly called on advertisers to pause spending until it was clear how Twitter’s content moderation policies would change under Musk’s leadership.
Key advertisers like GM, Audi, Pfizer and others have paused ads on Twitter
Since Musk took over Twitter, several major advertisers like General Motors, Audi, Pfizer, United Airlines and others have announced pausing advertising on the platform. This exodus of key advertisers highlights concerns over how Musk’s management of Twitter may impact brand safety and content moderation. Though Musk said policies have not changed, the loss of ad revenue shows companies remain cautious amid the uncertainty.
Twitter’s ad business was already struggling before Musk’s takeover
While the pullback of advertisers has clearly hurt Twitter’s revenue, it’s important to note the company’s ad sales were struggling even before Musk acquired it. According to data from MediaRadar, Twitter’s advertiser base declined from around 3,900 in May 2022 to 2,300 in August, prior to Musk’s takeover bid. However, it did rebound slightly to 2,900 in September, showing ongoing volatility.
Musk aims to diversify Twitter’s revenue through subscriptions
To offset the decline in advertising, Musk aims to diversify Twitter’s business model by boosting subscription revenue. He has focused on the new Twitter Blue verified subscription feature as a key element of this strategy. However, the rushed rollout of the new Twitter Blue verification process led to a wave of fake accounts that undermined advertiser trust.
The barons investment conference gave Elon Musk a high-profile stage to admit Twitter’s ad revenue has sharply fallen since his acquisition, due to civil rights groups pressuring major advertisers to pull back. Key advertisers like GM, Audi and Pfizer have paused spending amid uncertainty about the platform’s direction under Musk. However, Twitter was already struggling with declining ad revenue before Musk took over. Looking ahead, Musk aims to diversify revenue with subscriptions, but faces major challenges in stabilizing Twitter’s turbulent ad business.