Peter Kafka, Recode:
Facebook built one of the most amazing money machines the world has ever seen. Then Apple came and threw a wrench in the gears.
That’s one of the narratives that sprang from last week’s news, when Facebook’s parent company Meta delivered an alarming earnings report to Wall Street, which promptly cut an astonishing $250 billion out of the company’s value in a single day — a 26 percent drop.
Obviously, the goal was better privacy, not a move against Facebook specifically. But Facebook did get hammered. But they are still healthy enough:
Facebook is still making an enormous amount of money from advertising — analyst Michael Nathanson estimates the company will generate $129 billion in ad revenue in 2022. But that would mean its ad business will only grow about 12 percent this year, compared to a 36 percent increase the previous year.
A specific sign of the drop:
Alex Austin, the CEO of Branch, a company that helps advertisers figure out how their campaigns are working: After Apple introduced its anti-tracking changes in the spring of 2021, advertisers who used Branch’s services to measure paid ads on iOS dropped by 20 percent.
And this, on the push to grow Facebook’s Marketplace Platform, with digital storefronts on Insta and Facebook:
Facebook can’t tell a shoe store if someone saw their ad on the app, then clicked through to the store’s site or app and bought something — but it can tell them if a Facebook user saw the ad on Facebook and then bought the shoes on Facebook.
Obviously, that depends on building traffic to Facebook and Instagram, having people view those platforms as a trusted shopping option.