Big Tech’s Digital-Ad Comeback Is Yesterday's News
Facebook, Google and Twitter may all pleasantly surprise when they release earnings this week. Going forward, the big wins will be harder to score.
Google’s ad revenue likely rebounded along with industry peers, but it faces a more challenging path forward.
Photographer: Krisztian Bocsi/BloombergEarlier this year, as the pandemic wreaked havoc on the economy, Facebook Inc., Alphabet Inc.’s Google and other big players in digital-advertising were bracing for a prolonged slump in the industry. It’s clear now that many of their worst fears haven’t come to pass. Marketers began spending again after governments relaxed lockdown orders and economies stabilized. But with elevated valuations already baking in expectations for a rebound and a surge in Covid-19 cases now threatening to stunt the recovery, investors might want to take a moment to stop and assess.
We will get a clearer picture of the online ad market’s condition later this week when Facebook, Alphabet and Twitter Inc. report results after the close of trading on Thursday. But let’s look at what we’ve learned so far from other companies this earnings season.