Falling Ad Revenue Causes Twitter India's FY24 Net to Plummet by 90%

Nitin Konde, Varun Bhardwaj

Oct 30, 2024 — 2 min read

Twitter India Sees 90% Net Profit Drop in FY24 Amid Ad Revenue Decline

After the company's worldwide ad sales team was fired by the new management led by Elon Musk, Twitter Communications India, now a part of X Corp. (previously Twitter), had a steep decline in net profit and revenue in the most recent fiscal year. This decline was mostly caused by a fall in ad revenues.

The company's net profit fell 90% to INR 3 crore from INR 30 crore the year before, according to its regulatory filings. Additionally, revenue dropped 90% from INR 208 crore to INR 21 crore. With an estimated 25 million users, Twitter's revenue in India is primarily derived from advertising.

Cutting Down on Expanses and Workforce

As it laid off almost all of its Indian personnel, which had previously consisted of more than 200 workers, the company reduced employee benefit costs by 95%, from INR 130 crore to INR 6 crore. The overall expenses then dropped from INR 168 crore to INR 19 crore, an 89% decrease.

In October 2022, Musk successfully paid $44 billion to acquire Twitter, which he later rebranded as X. Musk enacted significant changes around the world after the takeover, including widespread layoffs that had a significant effect on the ad sales teams, particularly in India.

A steep drop in revenue was caused by the combination of firing the ad sales teams and international businesses abandoning the platform, partly as a result of disagreements with Musk. Without an active sales force to keep up with clients and draw in new business, Twitter's ad income in India plummeted, resulting in sharp drops in profitability and earnings, according to a digital advertising specialist. This illustrates the wider difficulties X Corp has had around the world as it attempts to manage the consequences of internal reorganisation while putting new plans into action under Musk's direction.

Adding More Pain to the Agony

To make matters worse for the company, X has even sued multinational advertisers like Unilever and Mars for disregarding the platform under Musk. A net 26% of marketers stated that they intended to cut back on their X ad spending in 2025, the largest pullout from any significant worldwide ad platform to date, according to Kantar research.

The ongoing disputes with Musk caused several international businesses to halt their advertising in India, according to experts. Even in India, many brands are refraining from advertising on X because of the platform's contentious character and worries about brand protection. When it comes to social media advertising, YouTube, Facebook, and Instagram are usually given preference over X by advertisers, noted a digital market expert.