Meta Could Lose $7 Billion Due to Trump’s New Tariffs on China

Meta✴ risks missing out on $7 billion in ad revenue in 2025 due to tougher US trade tariffs against China. Chinese retailers including Temu and Sheen could cut ad spending on Facebook✴ and Instagram✴ amid the trade conflict, posing a major threat to Meta✴’s business as China remains its second-largest market after the US.

Image source: Muhammad Asyfaul / Unsplash

According to the annual report, Meta✴’s revenue in China in 2024 was $18.35 billion, or more than 11% of total sales. The main advertisers are considered to be trading platforms Temu and Sheen, and if they reduce budgets, this will directly affect the social network’s income. There are already signs of a reduction in advertising costs. As CNBC reports, Temu has reduced its promotion costs in the US, and its position in the Apple App Store has sharply worsened after the introduction of tariffs. If the trend continues, this will lead to significant financial losses for Meta✴.

The situation could get worse if the global economy goes into recession. Analysts warn that a prolonged downturn amid the trade war could wipe out $23 billion in ad revenue for Meta✴ in 2025 and cut profits by 25%. “Meta is particularly vulnerable to spending cuts from Chinese advertisers,” MoffettNathanson notes. “In the event of a recession, the company would face a double whammy: a general decline in the advertising market and a targeted reduction in investment from China.”

Since Donald Trump’s re-election as US President, the company’s shares have fallen by 19% to $499.36, but despite the risks, analysts maintain a “buy” recommendation for Meta✴ shares. There have been no official comments from the company yet, and the first-quarter report will be published next week.

admin

Share
Published by
admin

Recent Posts

In Switzerland, they built a cargo robot LEVA, which drives, walks, loads and unloads

Ground cargo robots are increasingly used in various industries and even deliver goods to ordinary…

54 seconds ago

In Switzerland, they built a cargo robot LEVA, which drives, walks, loads and unloads

Ground cargo robots are increasingly used in various industries and even deliver goods to ordinary…

7 minutes ago

Australia launches solar industrial steam generator with battery made of special graphite bricks

Australian startup MGA Thermal has completed production of a 5 MWh demonstration thermal storage system.…

59 minutes ago

Radeon RX 9070 and RX 9070 XT no longer available at MSRP

About two months ago, AMD launched the Radeon RX 9070 XT and RX 9070 graphics…

59 minutes ago

Radeon RX 9070 and RX 9070 XT no longer available at MSRP

About two months ago, AMD launched the Radeon RX 9070 XT and RX 9070 graphics…

1 hour ago

Raspberry Pi Cuts CM4 Prices: Modules Are $5–$10 Cheaper

Raspberry Pi has announced price cuts on its Compute Module 4 (CM4), which is used…

1 hour ago