**Elon Musk’s X Broadens Lawsuit to Include Amazon-Owned Twitch**
Elon Musk’s firm, X (previously known as Twitter), has expanded its legal confrontation by incorporating the Amazon-owned livestreaming service Twitch into its litigation against prior advertisers. The lawsuit, initially lodged in August, targets participants of the now-defunct Global Alliance for Responsible Media (GARM), alleging they colluded to boycott X following Musk’s acquisition of the platform in late 2022.
As per the lawsuit, X asserts that Twitch has not engaged in advertising on the platform within the U.S. since November 2022. X references a GARM document that purportedly contains an “executive endorsement” from Twitch concerning the alliance’s brand safety criteria. Business Insider was the first to report Twitch’s addition to the lawsuit.
The original legal action by X identified various advertisers, but subsequently, the World Federation of Advertisers (WFA) has dissolved GARM. Nonetheless, WFA has expressed its commitment to contesting the claims in court. Notably, X recently excluded Unilever from the lawsuit after reaching a confidential settlement with the corporation.
### **X Struggles with Falling Ad Revenue**
X’s legal proceedings come at a time of ongoing difficulties regarding dwindling advertising income. Ironically, the lawsuit was submitted soon after GARM had readmitted X into its initiative. However, the company still faces unresolved challenges with advertisers.
Documents acquired by *Bloomberg* in June 2024 disclosed that X’s earnings plummeted by almost 40 percent in the first half of 2023, which was entirely under Musk’s management. This occurred prior to Musk making headlines in November 2023 when he told advertisers to “go f*** yourself” after major brands like Disney and Apple withdrew their ads. These brands’ actions followed Musk’s endorsement of an antisemitic conspiracy theory and a report indicating that advertisements were running alongside Nazi-related content on the platform.
While some advertisers have returned to X in light of Donald Trump’s electoral victory, their advertising expenditures have significantly shrunk compared to previous amounts. Analytics organization Sensor Tower indicates that ad spending from X’s top 100 advertisers rose by merely one percent relative to the same period last year, which coincided with the advertiser boycott. However, expenditures from these premier advertisers remain down by 64 percent compared to the same timeframe in 2022, reflecting that X’s ad revenue is presently in a worse state than the period it accuses GARM of conspiring against it.
### **X Encounters Additional Hurdles**
Aside from its advertising troubles, X is contending with a declining user base. Reports from September pointed to a reduction in daily active users in crucial markets including the U.S., UK, and EU. Following Musk’s participation in Trump’s reelection campaign, X has also experienced a mass departure of users. Competitors like Bluesky and Threads have attracted millions of new users as a result.
Irrespective of the outcome of X’s lawsuit against Twitch, Mars, CVS Health, and other former GARM members, the company faces substantial hurdles in restoring its advertising revenue in the coming months.