Elon Musk & X sue Nestle, Lego over ad boycott

Elon Musk’s X, formerly Twitter, has intensified its legal battle against major global advertisers, including Nestlé, Lego, Colgate-Palmolive, and Shell, alleging a coordinated boycott that exacerbated the platform’s financial struggles.

In an amended antitrust lawsuit filed in a Texas court, X accused these companies of colluding under the Global Alliance for Responsible Media (GARM)—a now-defunct initiative by the World Federation of Advertisers (WFA)—to withhold billions in ad revenue following Musk’s 2022 takeover. The lawsuit claims GARM members unlawfully pressured advertisers to halt spending on X, damaging its competitiveness in the digital ad market.

X’s advertising revenue has plummeted since Musk acquired the platform for $44 billion. According to WARC Media, ad revenue fell by 46.4% from $4.5 billion in 2022 to $2.2 billion in 2023, with projections dipping further to $2 billion in 2024. In January 2025, Musk acknowledged in an internal email that X is “barely breaking even,” with stagnant user growth and unimpressive revenue.

The boycott stemmed from advertiser concerns over X’s relaxed content moderation under Musk, including reinstating banned accounts and reducing safety teams. GARM, formed to combat harmful content, allegedly orchestrated the withdrawal of 18 major advertisers between November and December 2022.

X contends that despite meeting industry safety standards, its ad prices remain depressed due to reduced demand. The platform now relies heavily on small businesses and non-GARM advertisers, with giants like Disney and United Airlines pausing campaigns.

As X battles in court, its ability to reclaim ad revenue hinges on rebuilding trust—a steep challenge amid Musk’s combative stance and competing platforms’ rise. For India, the case highlights the fragile dynamics between digital platforms and advertisers, emphasizing the need for stability in brand partnerships.