Tech giants like Google and Meta are losing revenue due to a changing online advertising market.
Google, Meta and smaller tech companies like SnapChat and Spotify have recently presented disappointing quarterly figures. Google recorded revenue growth of 6 percent over the third quarter of 2022, totalling €68.6 billion ($69.1 billion). Analysts expected growth of 9 percent. The tech giant posted the slowest revenue growth since 2013.
Meta recorded a decline in sales for the second quarter in a row. Revenue totalled $28 billion in the latest quarter. Both Meta and Google faced a drop in online advertising revenue. Smaller tech companies like Snap (the owner of Snapchat) and Spotify recorded lower ad revenue as well.
Palpable in Europe
The decline in online ad spending is felt in Europe. Some advertisers have become more cautious in recent months. In the Netherlands, analysts indicate that local online ad spending may fall further in the coming year. Many advertisers expect their ad budgets to shrink in 2023 because of macroeconomic circumstances.
There’s more to the decline than a drop in demand. Big tech increasingly competes with smaller players like Snapchat and TikTok. With the increasing popularity of TikTok, advertisers are seeing more and more opportunities to invest in the platform.