Tough one. How formal is your relationship? Is this advisor on an advisory board? Do you have regularly scheduled meetings? Does the advisor have other points of contact within the company aside from you? Do you have a long standing work relationship that has evolved, such as mentor or boss to advisor? Or is this person more what my Southern friend would call "an unrelated uncle" - a friendly outsider who cares about you and your progress, and gives you advice (possibly unsolicited)?
The more formal the relationship, the more sensitive you need to be when disengaging.
However, I would caution you to consider first why you want to disengage. Consider first why you engaged in the first place. Does this person still possess the knowledge, judgment and overall value that made you want to bring him or her into the company in the first place? Did one piece of bad advice negate all of the good advice you've (presumably) received previously - enough to want to make this person your advisor in the first place? Has it been getting worse in a short period? Is there perhaps something going on in the advisor's life that has made advising more difficult, or the advisor more averse to discussion following decision-making?
Also, consider whether it's been a matter of execution, rather than advice. Take a close look at how the decisions that haven't worked out have broken down, and see exactly what could have gone differently - with the clear eyes of a CEO, not the clouded eyes of a disappointed or disillusioned protege or advisee.
Finally, remember that the decision rested with you, not the advisor. The advisor gave you just that: advice, based on an understanding of the facts and circumstances you gave and as understood. Try not to blame others for failed decisions, or for relying on advice that didn't work out. It's understandable that you are disappointed, but the cost of running a business is that you run the business. Decisions rest with you - and you will lose relationships quickly the minute you forget that.
Now, I'm certain you don't intend to blame your advisor for your decisions at all, and perhaps your reasons for severing this part of the relationship are far deeper. I will warn you, however, that your advisor will find it difficult to understand why you wish to end the advisory part of the relationship, when he or she likely fully believes he or she is fulfilling his or her end of the bargain.
If there is a formal agreement, you must follow the terms of the agreement. Note that any equity obligations will likely need to be met. If it is simple generosity that leads this advisor to lend advice, you can simply (a) stop asking - assuming that is what leads to the advice-giving, and/or (b) when advice is freely offered, say "thank you - I think we're ok on this issue."
However, I should point out here that your advisor seems to be advising on issues that likely involve issues that involve confidential or strictly internal matters - "major decisions" are rarely made using entirely public information. That means you've either made this person an insider or are in the habit of freely discussing very confidential company manners to external people (which you should stop. Immediately.).
If you do not have an agreement with this advisor, this means this person listened to your very confidential, internal matters for some (likely) extended length, offered advice, information and possibly connections - and eventually personal friendship. You took all of those, and offered nothing in return, including standard compensation, and are now complaining about certain results that may or may not have resulted from some small aspect of his or her generosity.
You can easily terminate this, but realize that very, very few advisors would retain your friendship, such as it is.