Advertisers Remain Silent as Grok Falters and CEO Steps Down

Many major advertisers on X are currently choosing not to comment on their ongoing plans and relationships with the platform following a controversial incident involving its AI chatbot, Grok. The chatbot displayed racist and antisemitic behavior, openly praising Hitler and promoting harmful conspiracy theories. This turmoil was compounded by the resignation of X’s CEO, Linda Yaccarino, just one day after the incident.

Historically, the advertising response to such controversies has been more vocal. In 2023, several prominent companies, including Apple, Disney, and Warner Bros. Discovery, publicly paused their ad spending on the platform after Elon Musk made tweets perceived as antisemitic.

Although some of these companies resumed their advertising in 2024, their spending levels remained significantly lower. As of now, many of these businesses did not reply to inquiries regarding their current advertising strategy on X. Despite the lack of public statements, there are indications that advertisers are discreetly reducing their spending on the platform.

A representative from DraftKings confirmed that the company is handling the matter internally. Likewise, Red Deer Games indicated it has stopped advertising on X but did not clarify the reasons behind this decision. Experts in the advertising sector believe that companies are investing far less in X compared to the time before Musk’s takeover, and they express skepticism about a potential return to previous spending levels.

Brett House from MediaRadar emphasized the consistent decline in X’s ad revenue over the last 18 months. Meanwhile, despite the scandal, Musk is continuing with Grok’s development, having recently launched Grok 4 along with a new subscription model. Musk’s aggressive stance towards advertisers who distance themselves from X is highlighted by the legal action he has taken against several brands in the past year, indicating a combative relationship with the advertising community.

The recent resignation of Yaccarino, a respected figure in advertising, may further impact the platform’s ability to attract major brands. Experts like Lou Paskalis suggest that while she was instrumental in mitigating brand departures, the future of advertising on X remains uncertain. Advertisers are likely to proceed cautiously, especially with the looming threat of lawsuits.