The big story An oft-made point — that I agree with — is that tech publications don’t focus nearly enough on ads and adtech when one considers how ads prop up Silicon Valley’s biggest companies. In the past several weeks, however, broader conversations about ads has been surging in regards to an ad-pocalypse, a die-off in digital advertising driven by the lockdown. In the past ten days, a hefty chunk of the movers and shakers in the digital ad industry have shared their quarterly earnings and things are looking generally less dismal than expected. The industry giants were sure to broadcast it was far from business-as-usual, but generally investors seemed to be relieved with performances. In general, the next quarter seems to be a mystery for investors, but the digital ad market doesn’t seem to be hemorrhaging for the savvy players, which sent Facebook and Snap share prices surging following the earnings releases. Given most of these company’s Q1 revenues were only impacted deeply in March, these numbers probably won’t be the most representative of the slowdown compared to what we see in their second quarterly earnings. Here’s a snapshot of what tech companies showcased in the first full quarter of the calendar year. Facebook - Year-over-year advertising revenues were up 17% with $17.44 billion in Q1 ad revenues.
- “We experienced a significant reduction in the demand for advertising, as well as a related decline in the pricing of our ads, over the last three weeks of the first quarter of 2020.”
- The company isn’t giving guidance for the next quarter though they noted they “have seen signs of stability reflected in the first three weeks of April.”
Google - The company saw consistent gains across advertising categories, notably YouTube pulled in $4.03 billion this quarter compared to $3.03 in Q1 2019, up 33%
- “Performance was strong during the first two months of the quarter, but then in March we experienced a significant slowdown in ad revenues”
- Alphabet isn’t providing guidance for Q2, though it doesn’t usually tend to do give quarterly guidance.
Twitter - Twitter operates on a much smaller scale than Google or Facebook obviously, but they’re still an interesting data point. The company saw $682 million in ad revenue for the quarter, barely above the $679 million it pulled in for Q1 2020. They seemed to take a pretty hard hit in March.
- “As an indication of the rapid change in advertising behavior, from March 11 (when many events around the world began to be canceled and many in the US began sheltering in place) until March 31, our total advertising revenue declined approximately 27% year over year.”
- Twitter is not giving guidance for Q2.
Snap - Snap doesn’t break out advertising, but they had a huge quarter with revenues hitting $462 million, up 44% year-over-year. They said that they “doubled the amount of money committed via upfronts from advertisers in 2020 vs. 2019.”
- Snap’s CFO detailed a significant slowdown in the earnings call. While growth averaged out to 58% YoY in January and February, growth then slowed to 25% in March, and 15% in April overall with numbers dropping to 11% in the week ahead of Snap's earnings release.
- Snap didn’t give any guidance for Q2.
|
Post a Comment