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Where’s the “X” Factor? X (Twitter) One Year Post-Acquisition Recap

Since Elon Musk acquired Twitter in Oct'22, the company has encountered various headwinds such as losing advertisers, decreased usage and engagement, and increased competition from short-form video platforms. These challenges, along with economic uncertainty, have made the first year tough for the rebranded X (Twitter) as indicated by Sensor Tower data, which highlights declining user engagement, higher user churn, and the departure of important advertisers.

Where’s the “X” Factor? X (Twitter) One Year Post-Acquisition Recap

Key Takeaways:

  • X (formerly Twitter) has struggled to retain top advertisers in the post-acquisition era as platform issues over content and policy have contributed to an exodus of key advertising partners. Per Pathmatics by Sensor Tower data, forty six out of the top 100 advertisers on X from Oct’22 have completely ceased US ad spending on the platform as of Sep’23

    • The number of X advertisers (out of the top 100) who have ceased advertising on the platform peaked in Feb’23 with 54 ceasing ad spending on the platform. Although this figure has fallen to 46 advertisers as of Sep’23, this is still significantly higher than the first-month post acquisition (Nov’22) when only 12 out of the top 100 advertisers on the platform had ceased spending

  • X’s DAU growth in Sep’23 vs Oct’22 (-16%) was well below that of its largest social media competitors such as Snapchat (+11% YoY), Instagram (+8% YoY), YouTube (+6%), TikTok (+3% YoY), and Facebook (+2% YoY), which all saw increases during the same period, highlighted recently by The Wall Street Journal

  • Engagement, typically of great importance to advertisers on social media platforms, has also declined significantly on X in the post-acquisition era. Per ST data, X’s total hours engaged (a result of combining DAUs and average time spent per user) fell 8% YoY in 3Q23, and were down an average of 6% YoY, per quarter, from 1Q23-3Q23

  • Also indicating X’s struggles in engaging and retaining users, ST data shows that user churn has risen significantly on the platform in the past year. As of Sep’23, the amount of churned users for X was up more than 30% compared to Oct’22. Higher user churn coupled with falling engagement and overall active users could further complicate user monetization for X

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