Twitter’s rebrand to X isn’t fixing the cash drain; the company now bets on AI-crafted video ads to lure influencers and revive earnings.

Ad Revenue Slump Continues

Last month, X reported a 12% year-over-year decline in ad sales, the steepest drop since 2021. This decline follows a wave of advertisers shifting spend to Instagram Reels and TikTok’s short-form ecosystem. X’s flagship “tweet” format has struggled to attract high-budget video campaigns that dominate the market.

The Rise of Influencer Marketing

Influencer marketing now accounts for roughly $15 billion of U.S. ad spend, according to the Influencer Marketing Hub 2025 benchmark. Brands prize creators for their ability to cut through algorithm noise and speak directly to niche audiences.

X has tried to court creators with a 5% revenue-share program that pays musicians and video makers for content that drives engagement. However, the platform’s rebranding to X was also a recruitment pitch, but without a robust video-ad product, many influencers still favor TikTok’s native ad formats.

The Future of X’s Business Model If ad revenue continues to erode, X could face another round of layoffs.

The Future of X’s Business Model

If ad revenue continues to erode, X could face another round of layoffs. A further decline may force cuts to product development, slowing the rollout of new features that could keep the platform competitive. The revenue slump also narrows X’s moat against rivals, with Instagram’s ad CPM averaging $7.80 in Q4 2025, while TikTok’s rose to $9.20.

AI-Generated Video Ads for Influencers

On March 12, X launched “AI-Boost,” a tool that transforms an influencer’s existing tweets, images, or short clips into a 15-second video ad. The AI stitches together text overlays, motion graphics, and royalty-free music, delivering a ready-to-run ad in under a minute.

Maya Patel, a fashion micro-influencer with 120k followers, reported that her first AI-Boost campaign earned $12k in brand fees within three days. X positions AI-Boost as a win-win: brands receive scalable video creatives without hiring agencies, while creators earn a higher share of ad spend.

Concerns and Outlook

Critics warn that AI-generated ads may dilute authenticity. A recent survey by the Digital Marketing Institute found that 62% of users trust influencer content less when they suspect heavy automation. Moreover, the AI model has been flagged for occasional copyright missteps.

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The success of AI-Boost hinges on two factors: influencer adoption and advertiser confidence in the format’s performance. Early data shows a 30% higher click-through rate for AI-generated videos versus static image ads on X’s timeline. If that trend holds, the platform could recoup a portion of its lost ad dollars within the next fiscal year.

AI-Generated Video Ads for Influencers X Unleashes AI Video Ads as Ad Revenue Slides On March 12, X launched “AI-Boost,” a tool that transforms an influencer’s existing tweets, images, or short clips into a 15-second video ad.

Career note: For aspiring creators, mastering AI-Boost offers a fast track to video-ad production without a studio budget. Learning the tool’s parameters and staying ahead of copyright guidelines could make the difference between a side hustle and a full-time gig.

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