Linda Yaccarino shakes up X amid pressure from Elon Musk over costs

Linda Yaccarino has shaken up her inner circle at X as she faces pressure from Elon Musk to boost sales and cut costs, a year after she became chief executive.

Yaccarino fired her right-hand man and head of business operations and communications, Joe Benarroch, this month, said three people familiar with the matter.

Among other things, Yaccarino held Benarroch responsible for bungling the roll-out of the platform’s new adult content policy by failing to tell clients of the changes before it became public, two X employees said.

Taking over Benarroch’s responsibilities will be global government affairs head Nick Pickles, whose role has temporarily been expanded to include directing all global communications, the people said.

This week, Pickles, one of the few top Twitter staffers who survived the billionaire’s takeover, also attended the Cannes advertising festival alongside Yaccarino and Musk for the first time, several people said.

The shake-up has been seen as a boon for British-born Pickles, who once ran for office as a Conservative MP in the UK, before rapidly rising up the ranks at the platform to oversee its public policy and relationships with governments.

The reshuffle comes amid growing tensions between Musk and Yaccarino, stemming from her struggle to steady X’s financial health a year after Musk poached her from NBCUniversal.

One X senior staffer said she had become increasingly nervous as Musk piled pressure on her to raise revenues and lower her expenses – for example cutting staff from the US and UK sales teams and reducing spending on items such as travel.

Another said some recent staff losses were related to regular performance management reviews. At a meeting this month, Yaccarino said there would be a focus on “performance management”, said people inside the company.

At the same time as Yaccarino’s changes, Steve Davis, a long-standing Musk ally and chief executive of his Boring Company, was brought in by the billionaire in April to review X’s finances as well as performance management, said two people familiar with the matter.

Davis has been assessing cutting low performers, one person said, and is targeting dozens of jobs, another added. The move was seen by some as a sign of the continued worries about the platform’s finances.

An aerospace expert, Davis previously helped lead a cost-cutting effort at X in late 2022 and early 2023 in the wake of its acquisition, deciding on job cuts, slashing day-to-day expenses and renegotiating data licensing agreements and policies at the company.

Those efforts sparked speculation that he might be in the running for the chief executive position after Musk purchased X, then known as Twitter, and sacked its then-CEO.

Two people familiar with Yaccarino’s thinking said she is aware of him as a threat to her authority. Davis’s wife also works at X and is responsible for the platform’s real estate strategy, another person said.

Davis’s new responsibilities were first reported by the Verge.

In Cannes this week, Musk and Yaccarino have been attempting to woo back ad agency and brand bosses in person, after groups such as Disney, IBM and Apple pulled spending from the platform over concerns about content moderation as well as Musk’s provocative leadership style and posts.

Executives at X have said more than 60 per cent of brands that had paused advertising have resumed – albeit in small ways – in the past few months.

One person familiar with the conversations between Musk and advertisers said X’s management was keen to stress that the platform was safe for brands, as well as highlighting new features such as video and targeted marketing. However, some advertising chiefs at Cannes told the Financial Times that the site was not on their “preferred” lists of channels to use with their brand clients.

X and Musk did not respond to requests for comment. Benarroch, whose departure was first reported by the Wall Street Journal, did not respond to requests for comment. – Copyright The Financial Times Limited 2024