After Linda Yaccarino’s Departure As CEO, Will X Keep Embracing Ads Or Pursue Elon Musk’s AI Vision?

In her last public appearance as CEO of X, Linda Yaccarino sat down last month at the Cannes Lions advertising conference with tennis great Serena Williams.

Along with touting Williams’ forthcoming X podcast, the pair found common ground in their experiences with the social media platform long known as Twitter. The exchange took on new resonance this week in light of Yaccarino’s departure from the company.

Williams recalled being motivated to win an Australian Open, one of her 23 major singles titles, by a random tweet telling her she was “washed up” and soon to fade from the sport. “When I read that, I knew instantly that I was going to win,” she said. “I wish I had just screenshotted it and then @-ed him with a picture of the trophy.”

Yaccarino’s engagement with X has been far more consuming, of course. Working for Musk, the richest person on Earth and commander of an army of 222 million followers, has “been definitely not boring,” the former NBCUniversal sales chief said of her two-year tenure. Pointing to the crowd with a tight smile, she added, “I see some folks out there who have leaned in and reached out to me and said, ‘Keep going.’ And you lean into that positivity.”

The long-expected end of the line for Yaccarino followed the acquisition of X by Musk’s AI company, xAI, last March. That set the wheels in motion for the CEO’s departure, but it also has raised broader questions about strategic direction. Whoever steps into the CEO role (if anyone does) is unlikely to continue along Yaccarino’s path. While her farewell post on X said she and Musk had turned the platform into an “everything app,” that claim isn’t yet actually true. Her main forte has always been advertising, and an ability to leverage a large network built over 30 years at NBCU and Turner with a tenacious but polished business approach.

Reportedly over mounting objections from a Musk-appointed CFO, former Tubi exec Mahmoud Reza Banki, Yaccarino inked a number of splashy deals with sports leagues as well as notable talent. Along with Williams and her sister, Venus, X has forged ties with former Fox News personality Tucker Carlson and (for a hot minute) ex-CNN host Don Lemon. Advertising on X was jolted by the Musk acquisition for about 12 to 18 months in 2022 and 2023, given his firing of 80% of the company’s workforce, abandonment of content moderation in the name of “free speech” and willingness to amplify conspiracy theories and objectionable posts.

Tensions boiled over in November 2023 when Musk told advertisers boycotting the platform over brand safety concerns to “go f–k yourself” at a New York Times conference. After ad spending declined in Yaccarino’s first year, she helped restore it enough by the end of her run (in part via legal threats against advertisers threatening to stay on the sidelines, according to the Wall Street Journal) that investors who helped fund Musk’s $44 billion acquisition were said to have made their money back, at least on paper.

Going forward, with xAI capable of raising significant funds and Musk committed to the AI race, speculation has been growing about X becoming more of a seedbed of AI research than the video ad vehicle Yaccarino envisioned. “Linda’s playbook was perfect for social media in its traditional form, but even without the constant drama with Musk, it’s not clear that the strategy has a long future,” one former senior-level colleague told Deadline.

Henry Innis, founder of marketing firm Mutinex, wrote in a Substack post that Yaccarino’s exit “is “the most visible symptom of a strategic pivot of immense consequence. It suggests that Musk is not merely trying to fix X’s advertising business, but is instead preparing to jettison the model that has powered social media for nearly two decades.”

Content moderation and brand safety have been increasingly expensive for even large-scale players like Meta to fund, and the concurrent rush to spend heavily on AI means that there is likely to be a broader shift. AI tools are seen as being capable of realizing Musk’s vision of “everything apps” that are more service-based and less reliant on advertising, which has traditionally accounted for more than 90% of annual revenue for the major social players.

“Our company’s now an AI company, so I’m not working for a social media company,” said Tim O’Mahony, director and head of international content for X during a Thursday conference about soccer held in Newark, NJ. Execs at xAI are working to create an “everyday use case” and “train the AI model to improve it to get better experiences for advertisers, for users, make it more brand-safe,” O’Mahony added. Musk is “getting heavily involved with it now. So, we are learning with him.”

The need for learning and improvement with generative AI, of course, became abundantly clear this week. Yaccarino’s departure came a day after Grok, the chatbot created by xAI, spewed out a series of hateful and antisemitic posts, calling itself “MechaHitler.”

Yaccarino, striving to shine more positive light on the platform in the Cannes conversation with Williams, asked why she and her sister chose X as the home of their podcast. The response was revealing. X “is always a place where you can just say your thoughts and just be real,” Williams said, with a knowing chuckle. “Obviously, you get a lot of feedback on those thoughts, and a lot of them are honest and a little harsh. … But I love to look things in the eye. I love to look a challenge in the eye and face it.”

Yaccarino nodded along and said “we need more of that” when Williams said her podcast would feature gossip of a positive nature. She also would likely have endorsed O’Mahony’s line this week. Intended as a mission statement, it could have been a description of the chaotic atmosphere inside X, whose agenda is continuously refreshed by the impetuous Musk: “We say, ‘today’s timeline is tomorrow’s headline.’”