X struggles with revenue, eyes Q5 ad push to reclaim advertisers

2024 has been a challenging year for X, with reports suggesting the company's ad revenue continues to decline, following a significant dip of around 30% in 2023. Despite massive cost-cutting efforts, including slashing 80% of its workforce, the platform is predicted to report a substantial financial loss for the year. As the year draws to a close, the platform is now making a final push to capture advertisers' attention, promoting its 'Q5' opportunities and highlighting key engagement trends for the upcoming period.

With the holiday season fast approaching, the platform believes there is a significant opportunity for brands to reach a more engaged audience. The period is expected to see more people spending time on social media, with the platform suggesting this increased activity could boost ad effectiveness. Additionally, the platform claims that with less competition for ad space during this time, advertisers can benefit from more cost-effective campaigns.

According to X's data, mid-December to mid-January presents an ideal window for advertisers. The platform revealed that during this period last year, they saw a 34% reduction in the average cost-per-mille (CPM) and a 19% drop in cost-per-engagement (CPE), which it claims makes it a prime time for brands to maximize their ad spend.

The platform also emphasises the value of its AI-powered ad system, which is part of the broader xAI initiative. This system is designed to help brands efficiently target high-intent audiences, driving conversions with minimal effort. For advertisers, this means that even in the face of challenging financials, the platform is positioning itself as a viable option for reaching a receptive, affluent audience looking for post-holiday deals or products aligned with New Year’s resolutions.

With Q5 presenting an opportunity to boost ad performance at lower costs, the platform is encouraging businesses to leverage its enhanced targeting tools and data insights to optimise campaigns during this crucial end-of-year period.

For the platform, the Q5 push is crucial to its financial recovery. With ad revenue continuing to struggle, this period may be one of its last chances to win back advertiser confidence and ensure a more stable revenue stream heading into 2025. As such, it’s offering incentives and more ad options to help brands make the most of the final stretch of the year, hoping to offset its ongoing challenges in the advertising sector.