In recent weeks, Google and Meta’s stocks crashed after the release of their Q3 earnings report which failed to meet investor expectations. Google’s shares dropped 33% due to poor performance from their core business offerings including Google Search and ad revenues which fell 26% lower than expectations.
At the same time, YouTube experienced its first decline in revenue ever of 2%. In addition, uncertainty about future performance during a possible recession prompted hiring lulls and talks of ending its Stadia gaming service come January. Further, Meta’s revenues fell 8% below expectations while Snap also experienced declining revenue growth. Investors suspect that politically charged forces that emerged after the Musk and Twitter standoff are responsible for placing pressure on global advertisers causing a digital advertising slowdown across all social media companies.
The following sources were used:
- Meta stock tanks after earnings miss on revenue, lighter-than-expected Q4 guidance, YahooFinance
- Google Earnings Badly Miss Estimates As YouTube Ad Revenue Falls, Investor’s Business Daily
- Is Google A Buy Or Sell As Third Quarter Earnings Miss, YouTube Revenue Falls?, Investor’s Business Daily