Sources: in an update to investors, Twitter reports a ~40% YoY decline in both revenue and adjusted earnings for December 2022, as advertisers fled the platform
Quoting @Techmeme: #retoot https://techhub.social/... Tweets: Scott Nover / @scottnover : Surprised it's all that little. https://twitter.com/... @zefede : Looking into this. https://twitter.com/... Angelo Carusone / @goangelo : So this 40% figure is December revenue. I did an analysis recently, and my initial finding was that Twitter's revenue is down about 56% so far this year. https://www.wsj.com/... Chris Fralic / @chrisfralic : More than 70 of Twitter's top 100 advertisers from before Mr. Musk's takeover weren't spending on the platform as of the week ended Feb 25th. Twitter's staff is down to roughly 2,000 from close to 8,000 before he acquired the company. https://www.wsj.com/... Eliot / @eliotetc : Nah man he's got this, you haters are gonna feel so dumb when the thing that's happening turns out to actually be the thing happening in my imagination https://twitter.com/... @emptywheel : Thanks to Elmo for conducting a VERY expensive experiment to measure the cost of befriending Nazis. https://twitter.com/... Christian Christensen / @chrchristensen : That's a huge drop. Musk is actively scaring advertisers (and likely investors) away. https://twitter.com/... Scott Lincicome / @scottlincicome : Tweet harder, everyone. https://www.wsj.com/...
Context & Ripple Effects
Twitter's December investor update puts a financial measure on an advertiser retreat that had already widened from more than a third of its top 100 clients pausing ads in November to roughly 70% of its former top 100 spenders not advertising by mid-December. The reported revenue and adjusted-earnings declines show that the spending pullback was affecting the company’s core business, not merely advertiser sentiment.
Demand signals were weakening alongside advertiser spending: visits to Twitter’s ad manager fell sharply in October and November. That makes the December results significant as evidence of a shrinking ad-sales pipeline as well as lost current revenue.
First-order effects
- Twitter faces lower revenue and adjusted earnings at the same time its largest historical advertisers are withholding spend, tightening the company’s ad-funded operating base.
- Advertisers that paused campaigns have reduced Twitter’s immediate access to the high-budget accounts that historically concentrated platform ad spending.
Second-order effects
- The decline in ad-manager activity leaves Twitter with fewer active buyers to convert or expand, making recovery dependent on reactivating departed advertisers rather than simply retaining existing campaigns.
- Twitter’s investor communications must now contend with a measurable gap between its prior top-advertiser base and December financial performance.
Third-order effects
- If withdrawals among major advertisers persist, Twitter’s advertising business becomes more dependent on a narrower and potentially less stable buyer base, increasing pressure to rebuild advertiser demand rather than rely on legacy relationships.
The trend: Twitter is moving from an advertiser-confidence shock into a revenue-contraction cycle, with weakening buyer activity reinforcing the loss of major ad spenders.