After two tumultuous years at the helm of X, CEO Linda Yaccarino announced her departure from the company last Wednesday. Who will replace her—as X is absorbed into Elon Musk’s AI venture xAI—remains uncertain.
What most agree on: the next leader will look very different.
“I don’t recall anyone who told the ad community to ‘go fuck yourselves‘ and then said, ‘you know what? We really need a strong ad-sales-based CEO,’” said Matt Prohaska, CEO and principal at media advisory firm Prohaska Consulting.
Advertising on X before Musk’s takeover generated upwards of 90% of the company’s revenue. Since Yaccarino was appointed CEO in May of 2023, following swaths of big brands abandoning the app over brand safety concerns exacerbated by Musk’s lax approach to content moderation, some brands returned with reduced spend, while others faced litigation.
But while X’s battle with the ad industry flares, advertising is becoming less central to its business model in the wake of the company’s $45 billion all-stock acquisition by Musk’s AI firm xAI in March. X’s advertising-dependent model could soon be supplanted by a primarily subscription-based AI service, with X’s rich data used to train LLMs.
In this emerging paradigm, any successor to Yaccarino would need to offer technological know-how.
“X’s priorities have shifted since Yaccarino became CEO in 2023,” said Jasmine Enberg, vp and principal analyst, social media at Emarketer. “While X still needs advertisers to pay the bills, the company is now focused on AI. Yaccarino’s departure paves the way for X to lean harder into this new direction, and X will likely look for someone who is more suited to the AI era.”
xAI’s takeover of X, taken with the tectonic shifts happening under X, may nullify the need for a traditional CEO altogether. As reported by the Wall Street Journal, Yaccarino was effectively demoted in X’s merger with xAI.
Musk could tap an operational leader to keep the engine of X, the social platform, running smoothly while he manages xAI, the AI powerhouse.