Meta to Roll Out Ads on Threads Amid X’s Struggles with Advertisers

Overview: Meta Platforms Inc. META, led by Mark Zuckerberg, is gearing up to launch advertisements on its Threads platform in early 2025. This comes as Elon Musk’s X sees a decline in brand partnerships.

Details of the Announcement: According to a report from The Information, Meta will allow a select group of advertisers to create and publish ads on Threads starting in January 2024. Although the specific ad format remains undisclosed, they are likely to appear as “sponsored” posts as part of Meta’s strategy to leverage Threads’ rapid user growth. Statista reports that Threads’ monthly active users rose to 175 million by the end of June 2024, a notable increase from 150 million the previous quarter.

This initiative aligns with earlier indications of Meta’s plans to generate revenue from the platform. Instagram head Adam Mosseri confirmed that the company is “definitely” working on bringing ads to Threads.

Market Context: X, which competes with Threads, has been losing support from advertisers due to concerns over explicit content and free speech controversies. A report from analytics firm Kantar indicated a significant drop in confidence among marketers regarding X as an advertising vehicle since Musk’s acquisition. They predict a 26% decline in ad spending on X in 2025.

Interestingly, despite these challenges, some advertisers are reportedly reconsidering their strategies and may return to X to maintain favorable relations with Musk and the incoming President, Donald Trump.

In a separate financial update, Meta’s third-quarter earnings report revealed a revenue boost, reporting $39.8 billion in advertising revenue over the last three months—this revenue accounts for 97% of the company’s total earnings. However, Meta’s CFO Susan Li noted that Threads is not expected to be a major revenue source in 2025.

For the latest updates in technology, subscribe to the Benzinga Tech Trends newsletter.

Final Thoughts: As Meta prepares to introduce ads on Threads, it aims to capitalize on X’s declining popularity with advertisers. The outcome of this initiative remains to be seen, but it could shift the dynamics of social media advertising.

Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.

Photo courtesy: Shutterstock