Linda Yaccarino, CEO of X, has made significant changes to her team as she finds herself under enormous pressure from Elon Musk to increase sales and reduce expenses, one year into her tenure. Joe Benarroch, her trusted lieutenant and the head of business operations and communications, was dismissed this month, disclosed three sources close to the situation.
One of the reasons Yaccarino gave for Benarroch’s departure was his mishandling of the release of the platform’s updated adult content policy, neglecting to inform their partners before the news went public, according to two X employees.
Following Benarroch’s exit, Nick Pickles, the head of global government affairs, has temporarily taken on his tasks, overseeing all global communications. This week, Pickles, one of the few senior Twitter employees to last Musk’s takeover, attended the Cannes advertising festival with Yaccarino and Musk for the first time, observed by several individuals.
The British-born Pickles, who has previously campaigned as a Tory MP back in the UK, has risen swiftly through the ranks at X to manage its public policy and relationships with governments, and these changes have been viewed as a benefit to him.
The reshuffle is set against a backdrop of increasing friction between Musk and Yaccarino, as she grapples to balance X’s financial stance one year after Musk poached her from NBCUniversal. One X senior employee disclosed that Musk’s increasing demands to boost revenue and tighten expenditure have caused her stress. Actions include shedding staff members from US and UK sales teams and trimming down on costs such as travel.
Some recent staff exits, another employee stated, were due to regular performance management reviews. During a company meeting this month, Yaccarino emphasised the importance of “managing performance”.
Concurrently, Musk brought Steve Davis, a close associate and the CEO of his Boring Company, onboard in April to look into X’s finances and performance. Davis has been exploring the possibility of cutting loose underperforming employees, targeting numerous jobs, it was revealed by an individual close to the matter. Some viewed this as an indication of continued financial concerns about the platform.
Aerospace specialist Davis was involved in implementing cost-saving measures at X following its acquisition in late 2022 and early 2023. He made decisions regarding redundancy, reducing daily costs, and rearranging data licencing contracts and company regulations. This led to rumours that he may be considered for the CEO role after Musk bought the company, previously known as Twitter, and fired the existing CEO.
Two people close to Yaccarino mentioned that she views Davis as a threat to her power. Another source confirmed that Davis’s spouse is also employed at X with the role of handling the real estate strategy for the platform.
The news about Davis’s new roles was originally reported by the Verge.
In the ongoing week in Cannes, Musk and Yaccarino have been trying to win back CEO’s of advertisement agencies and brands in person. This follows major companies like Disney, IBM, and Apple withdrawing their advertisement spending due to inadequate content moderation issues and doubts over Musk’s controversial leadership style and posts.
X executives claim that over 60% of brands that had previously suspended advertisements have restarted – albeit on a minor scale – over recent months.
A source informed that during discussions between Musk and advertisers, X’s management was eager to emphasise that the site was safe for brands and pointed out new developments such as video and focused marketing. However, a few advertisement chiefs at Cannes informed the Financial Times that the website was not included in their “preferred” list of channels for their brand clients.
Neither X, Musk nor Benarroch responded to requests for comment. Benarroch’s exit was first reported by the Wall Street Journal.
– Copyright The Financial Times Limited 2024.