Yaccarino

Despite its aim to achieve profitability next year, the company grapples with persistent challenges.

During the Vox Media Code Conference on Wednesday, Linda Yaccarino, CEO of X (formerly Twitter), said confidently that the company is on track to achieve profitability in early 2024. The optimistic outlook follows the company’s determined efforts to rebuild its reputation and regain advertisers who had previously distanced themselves due to content-related concerns.

“Now that I have immersed myself in the business, and we have a good set of eyes on what is predictable, what’s coming is that it looks like in early ’24, we will be turning a profit,” Yaccarino declared on stage at the Code Conference.

X Regains 90% of Advertisers to the Platform

If realized, this predicted financial milestone would be a significant achievement for the social media giant, which had struggled to generate annual profits during its first 13 years. Yaccarino’s positive remarks align with her consistent comments since assuming the CEO role in May.

In an August CNBC interview, she indicated that X was “approaching breakeven” in terms of operational run rate. Additionally, a leaked memo from Yaccarino in July revealed that X’s user engagement had reached an all-time high. During the Code Conference, she further stated, “90% of the top 100 advertisers have returned to the platform, and in the past 12 weeks alone, about 1,500 more have returned.”

It’s worth recalling that Yaccarino had worked at NBCUniversal as the Chief Advertising Officer before her appointment as X CEO. Billionaire tech mogul Elon Musk had expressed confidence that she would help bring back advertisers to the social media platform. This month, Musk revealed that ad revenue was down 60%.

Yaccarino: X Is a Fresh Company

Yoel Roth, the former head of trust and safety at Twitter also shared his thoughts at the Code Conference. He expressed the belief that while having Yaccarino on board is a positive development, it may have limitations in fully restoring the confidence of brands.

“Having a reasonable, tenured, well-respected executive is a good thing. But for advertisers to come back, they’re going to need evidence of progress on safety that Twitter can’t provide,” Roth emphasized.

Yaccarino responded to Roth’s comments by noting that Twitter operated under different principles during Roth’s tenure. She highlighted that X is a fresh company with a strong focus on promoting freedom of expression. Additionally, Yaccarino contested the notion that X is not welcoming to advertisers.

X Confronts Ongoing Controversies

Despite its aim to achieve profitability next year, the company grapples with persistent challenges. The social media platform recently downsized its trust, safety, and election integrity teams. Additionally, X filed a lawsuit against a research organization that found harmful content on the site.

Earlier this month, Elon Musk threatened to sue the Anti-Defamation League (ADL) for the slump in US advertising revenue.

In response to these challenges, X has proactively sought solutions to address content-related concerns. The company has collaborated with independent firms to conduct assessments of the material posted on its Platform.

Furthermore, X has strengthened its workforce by bringing in new hires across key departments, including sales, partnerships, and brand safety, all of which play vital roles in interacting directly with advertisers, as highlighted by Yaccarino.

Despite recent workforce adjustments, the company remains steadfast in its commitment to preserving the integrity of elections. The San Francisco-based firm continues to combat antisemitism actively, underscoring its dedication to fostering a secure online environment.

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X Corp. CEO Linda Yaccarino says she has 'autonomy' under Elon Musk

X CEO Linda Yaccarino told CNBC on Thursday that the company’s decision to get rid of its Twitter branding reflects owner Elon Musk’s vision for the app.

“Elon has been talking about X, the everything app, for a very long time,” Yaccarino said in an interview with CNBC’s Sara Eisen. “Even when we announced that I was joining the company, I was joining the company to partner with Elon to transform Twitter into X, the everything app.”

Yaccarino, who started the job in June, said Musk has been working up to this since buying Twitter late last year.

“Think about what’s happened since the acquisition,” she said. “Experiences and evolution into long-form video and articles, subscribe to your favorite creators, who are now earning a real living on the platform. You look at video, and soon you’ll be able to make video chat calls without having to give your phone number to anyone on the platform.”

Yaccarino also highlighted the company’s plans to enable payments between users and friends and creators.

“The rebrand represented really a liberation from Twitter,” she said. “A liberation that allowed us to evolve past a legacy mindset and thinking. And to reimagine how everyone, how everyone on Spaces who’s listening, everybody who’s watching around the world. It’s going to change how we congregate, how we entertain, how we transact all in one platform.”

Eisen pushed Yaccarino on the power of the Twitter brand and compared it to Johnson & Johnson changing the name of Band-Aid.

“If you stay Twitter, or you stay whatever your previous brand is, change tends to be only incremental. And you get graded by a legacy report card,” Yaccarino said. “And at X we think about what’s possible. Not the incremental change of what can’t be done.”

She added that the recent product changes and infrastructure improvements “answers the question of ‘why rebrand?'”

Yaccarino has ‘autonomy’ under Musk

Yaccarino said she has “autonomy” under Musk, adding that advertisers should be comfortable returning to the platform.

“Mine and Elon’s roles are very clear,” she said.

Yaccarino pointed to the post, announcing her hiring, where Musk underscored his continued control over product design and new technology.

“Elon is working on accelerating the rebrand and working on the future,” Yaccarino said. “And I’m responsible for the rest. Running the company, from partnerships to legal to sales to finance.”

Questions had swirled about Yaccarino’s ability to operate under Musk, given his extensive control over the company and his other ventures, including Tesla and SpaceX.

Yaccarino, former global advertising chief at CNBC parent company NBCUniversal, also emphasized X’s effort to improve the advertiser experience, after brands fled from the platform following Musk’s acquisition of Twitter.

Hate speech and potentially illegal content proliferated in the days and weeks after Musk took control of the platform, CNBC and NBC News previously reported. Brands were unwilling to risk having their promotions appear next to concerning content, leading to a mass exodus of advertiser dollars.

Yaccarino said X’s trust and safety team is “healthier” than it was when it was publicly traded. “You might not agree” with all posts, Yaccarino added.

Twitter effectively disbanded its ethical artificial intelligence team in November and laid off all but one of its members, along with 15% of its trust and safety department. The decision stopped the ethical AI team’s work on “algorithmic amplification monitoring,” or tracking elections and political parties to see if “content was being amplified in a way that it shouldn’t,” Rumman Chowdhury, the team’s former lead, told CNBC in May.

Yaccarino faces an uphill battle in rebuilding advertiser trust. Musk has claimed that user engagement continually reaches fresh highs, but the company has yet to provide concrete data to back up those assertions. Coca-Cola, Visa and other brands returned to advertising under her leadership, Yaccarino said, as a result of her direct engagement with marketing and communications executives.

Brands are now “protected from the risk of being next to” potentially toxic content, Yaccarino said. She added that if content is “lawful but awful” it’s difficult to remove it from the platform, but that the company’s new content controls would reduce advertiser risk.

Yaccarino told Eisen that head count had stabilized at 1,500 employees, down from 8,000 before the acquisition. The layoffs, which occurred before her tenure, were a “very necessary cost discipline exercise,” she added.

X Corp. now a much healthier and safer platform than a year ago, says Linda Yaccarino

Meta’s Threads and potential Musk-Zuckerberg fight

Yaccarino was relatively dismissive of the threat posed by Meta’s Threads, which has seen engagement fall off since a buzzy launch. But, she added, “you can never ever take your eye off any competition.” Meta already captures significant advertiser spending through Instagram and Facebook. Threads has yet to introduce advertising.

She also demurred on a potential cage match between Musk and Meta CEO Mark Zuckerberg. If it does happen, Yaccarino said, “Elon is training,” adding that a potential fight would be a “great brand sponsorship opportunity.”

— CNBC’s Hayden Field contributed to this report.