X CEO Linda Yaccarino has confirmed in interview with Japanese newspaper Nikkei that the social media company will set up a new software engineering team and headquarters in Japan.
This will be X’s first team and headquarters outside of the US.
Go deeper with GlobalData
Yaccarino confirmed that Japan is X’s second largest advertising market and stated that the new presence in Japan would allow the app closer communication with Japanese advertisers. She clarified that X was particularly interested in advertising from small to medium-sized businesses in Japan.
X’s advertising revenue has fallen by half following the app’s acquisition by Elon Musk.
The app has recently faced an advertising boycott from leading companies like Lionsgate and Apple after Musk allegedly supported an anti-Semitic post.
Since then, Musk has responded harshly to advertisers during an interview whilst also apologising for his post.
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By GlobalDataDespite this boycott, Yaccarino has stated that X’s ad revenue from small and mid-sized businesses is “booming” during her Nikkei interview. She also said that advertisers who had left the platform are “fully invited” to return.
Online advertising supplies the bulk of social media platform revenues.
Research company GlobalData’s thematic intelligence report into social media found that social media’s ad-driven business model is facing pressures across the business.
Whilst X may struggle more than other social media companies due to Musk’s controversial online presence and comments, tightening regulations over the use of data are set to disrupt targeted advertising for all social media companies.
“Larger companies, such as Google, will be particularly impacted as they have built their dominance on this business model and are already under scrutiny in the EU for cross-platform user profiling,” reads the report, “That said, larger companies still dominate the digital ad market, impacting smaller companies’ earning potential in this space.”
X will begin hiring app developers and engineers in 2024 for its Japan-based team.
