Good morning, Broadsheet readers! A succession battle grips Esteé Lauder, GM CEO Mary Barra's robotaxi investment is at a crossroads as Cruise's CEO exits, and Linda Yaccarino is sticking by Elon Musk and X. Have a wonderful Wednesday!
- Stand by X. Before Linda Yaccarino became the CEO of Twitter (now X) in June, she had a well-respected career in the advertising industry. She worked her way up the ladder at Turner over two decades before climbing to the top at NBCUniversal, where she was chairman for global advertising and partnerships.
When she accepted the X CEO job—one that came with Elon Musk's unorthodox way of running the platform, from making spur-of-the-moment decisions and policy changes to lashing out at critics—her choice both calmed some people worried about Musk's leadership and baffled others curious about why she'd take such a risk.
Now, the latter camp has come out in full force. It all escalated last week, when Musk responded to a tweet that said that Jews encouraged "hatred against whites." "You have said the actual truth," Musk wrote on X in response to the tweet. Jewish groups (and the White House) claim that the post espoused the antisemitic "replacement theory" that "Jews have organized nonwhite immigrants to replace the white race," which was the ideology of the mass shooter at the Tree of Life Synagogue in Pittsburgh in 2018. Musk said attempts to label him an antisemite are "bogus."
At the same time, a Media Matters report found that ads ran next to "pro-Nazi" content on the platform. Musk threatened to sue the media watchdog group—and X filed a defamation lawsuit yesterday. Media Matters says it stands behind its reporting.
Brands fled the platform in even greater numbers than usual. IBM, Apple, Walt Disney, Comcast, and Warner Bros. were among the businesses to suspend advertising.
Many ad execs are now reaching out to Yaccarino personally, advising her to leave her job. Lou Paskalis, CEO of marketing consultancy AJL Advisory and former head of global media at Bank of America, told Axios that he texted Yaccarino to tell her to resign "before her reputation is damaged."
The push came while Yaccarino attended her daughter's wedding over the weekend. And indeed, the entire situation is a family affair. Yaccarino's son, Matt Madrazo, is reportedly leading X's effort to bring back political advertising, Semafor reported.
Yaccarino, however, has stood by her employer. When her peers have reached out over the past several days, she's told them that she "believes in X’s mission and its employees," according to the Financial Times. She echoed that sentiment in a town hall with employees yesterday, Fortune's Kylie Robison reported.
Of course, the antisemitic tweet scandal is just the worst and the latest in a long line of questionable decisions since Musk bought Twitter for $44 billion in 2022—more than double what the company is valued at today. Yaccarino may be sticking by her boss, but advertisers aren't. "The issue is no longer about content adjacencies or content moderation," Paskalis said. "It's simply that the owner is not someone marketers can do business with."
X isn't the only Elon Musk business under fire. Fortune's new digital package on Elon Musk's universe of companies digs into X but also covers his other ventures, like his ChatGPT competitor and trouble at the Boring Co.
Emma Hinchliffe
emma.hinchliffe@fortune.com
@_emmahinchliffe
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