Donald Trump’s tough tariffs against China might be doing America more harm than good.
A new report has shared how the stringent tariffs could drastically impact Big Tech, including Facebook’s parent firm Meta. For instance, advertising businesses could take the $7 billion plunge in 2025 as per new estimates.
The news comes to us thanks to a new research note shared by MoffettNathanson, which analyzes the effect of China’s retailers on the US economy. We know how products coming in from e-commerce giants Temu and Shein could be impacted, and their advertising budgets on Meta would be much lower than before. After all, who wants to have a high budget after tariffs like this? Remember, these companies do pay a hefty amount to Meta’s Instagram and Facebook for ads.
Meta’s latest revenue report speaks about the firm hitting $18.35 billion last year, and that’s over 11% of the total in sales. But since the majority of Meta’s China revenues come from Temu and Shein, such online retailers really do predict the company’s future stats. We do expect them to slash their advertising campaigns this year. This means the ad sales figures would be affected by $7 billion, which is massive.
Temu is already hinting at reducing the American ad spending and witnessing a mega drop in the company’s rankings on the App Store after Trump’s tariffs in China. So, to put it simply, you cannot overstate how important China’s business is for tech giant Meta.
China is the firm’s second biggest revenue earner after the US. This is major news considering how the country has no Meta users or any active platforms related to the firm. Now we might see Meta face even more challenges in 2025 if bigger markets head into a phase of recession.
The combination of long economic shutdowns and trade disputes with China is a recipe for disaster that might see $23 billion worth of ad revenue get wiped off Meta’s plate and really impact fiscal earnings this year.
Meta is very vulnerable to the effect of advertisers in China and how they choose to play out their cards for ad spending. With trade tensions at their peak. Meta might face double the impact of reduced ad spending from China, combined with weakness in advertising cycles.
Image: DIW-Aigen
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A new report has shared how the stringent tariffs could drastically impact Big Tech, including Facebook’s parent firm Meta. For instance, advertising businesses could take the $7 billion plunge in 2025 as per new estimates.
The news comes to us thanks to a new research note shared by MoffettNathanson, which analyzes the effect of China’s retailers on the US economy. We know how products coming in from e-commerce giants Temu and Shein could be impacted, and their advertising budgets on Meta would be much lower than before. After all, who wants to have a high budget after tariffs like this? Remember, these companies do pay a hefty amount to Meta’s Instagram and Facebook for ads.
Meta’s latest revenue report speaks about the firm hitting $18.35 billion last year, and that’s over 11% of the total in sales. But since the majority of Meta’s China revenues come from Temu and Shein, such online retailers really do predict the company’s future stats. We do expect them to slash their advertising campaigns this year. This means the ad sales figures would be affected by $7 billion, which is massive.
Temu is already hinting at reducing the American ad spending and witnessing a mega drop in the company’s rankings on the App Store after Trump’s tariffs in China. So, to put it simply, you cannot overstate how important China’s business is for tech giant Meta.
China is the firm’s second biggest revenue earner after the US. This is major news considering how the country has no Meta users or any active platforms related to the firm. Now we might see Meta face even more challenges in 2025 if bigger markets head into a phase of recession.
The combination of long economic shutdowns and trade disputes with China is a recipe for disaster that might see $23 billion worth of ad revenue get wiped off Meta’s plate and really impact fiscal earnings this year.
Meta is very vulnerable to the effect of advertisers in China and how they choose to play out their cards for ad spending. With trade tensions at their peak. Meta might face double the impact of reduced ad spending from China, combined with weakness in advertising cycles.
Read next: YouTube Expands Auto-Dubbing Feature and Shares New Live-Stream Gifting Tools
