Big brands allocate small ad budgets to dodge Musk's wrath

In the United States on March 31, 2025, major brands are beginning to allocate minimal amounts from their advertising budgets to the social media platform X, primarily to avoid appearing as if they are boycotting the social network. This shift comes in response to Elon Musk's aggressive actions against companies that ceased advertising on X following his controversial acquisition of the platform for $44 billion in late 2022. Concerns have been raised regarding the potential negative repercussions for those companies that have distanced themselves from X, including the risk to their stock prices resulting from negative comments made by Musk in the media. As a result, brands are attempting to maintain a presence on the platform without heavily committing their marketing budgets. Recently, there have been signs of improvement in advertising earnings for X, as investors show confidence in Musk's interactions with political figures and his management strategies. Although the platform's total revenue for the year is forecasted to increase to $2.3 billion from $1.9 billion last year, advertising expenditure has seen a slight decline of 2 percent in the first two months of 2025, when compared to the same period the previous year. Brands like Hulu and Unilever have resumed their advertising on the platform, though it remains clear that worries about backlash have influenced spending. Several notable advertising agencies have engaged in negotiations with X over the establishment of annual spending targets. Despite these new deals, the behavior of advertisers remains cautious. A study indicated that many of X's top advertisers in 2025 were absent from the platform just a year prior, indicating a notable shift in their engagement. This influx of new advertisers, including niche brands like Rock Paper Sizzle and Celsius drinks, demonstrates a diversification in the types of businesses looking to utilize X for marketing purposes. Moreover, there have been developments concerning X's legal actions, as the platform has pursued a federal antitrust lawsuit against organizations that it claims are engaging in wrongful coordination to boycott it. By strategically maintaining a form of advertising presence, brands seek to avoid potential legal and financial pitfalls linked to Musk's ownership of X while navigating the complex advertising landscape influenced by political dynamics.