Big Tech, Including Twitter and Google, Will Experience Slower Revenue Growth as Advertising Trends Fade: Report

ccording to an analyst study on Thursday, after extraordinary revenue gains last year, digital platforms such as Alphabet, Meta Platforms, Snap, and Twitter, now confront a dismal reality as pandemic-driven advertising patterns vanish.

Research firm MoffettNathanson slashed its 2025 sales predictions for each of the four firms by double-digit percentages.

US internet ad expenditure grew 38 percent in 2021 over the previous year. The most prominent digital advertising platform globally, Alphabet earned record revenue of $257 billion (approximately Rs. 19,95,499 crore) that year.

While the corporations have warned of pressure from inflation, the Ukraine crisis, and the end of a COVID-induced boost to advertising, the paper calculates for the first time the probable damage to revenue over the next several years.

“After years of uber-bullishness, we are legitimately worried about longer-term growth in digital advertising,” said Michael Nathanson, an analyst at MoffettNathanson, in the research.

Last year, growth in the advertising industry was fueled in part by an “extraordinary jump” in profitability at firms that saved money on office space and development and had more to spend on marketing and brands investing in advertisements to persuade people to purchase online Nathanson said.

But e-commerce as a share of retail sales has dropped back to pre-pandemic levels, and corporate spending is set to climb when employees return to the office, according to the research.

The business said it now anticipates internet advertising in the United States to rise by 12.5 percent annually through 2025, down from the prior projection of 18.5 percent annual growth.