Social media hammered by mounting questions over advertising
Social media has had a rough 2022 with lingering questions about advertising spending and a $44 billion takeover of Twitter that may or may not be happening, depending on which Elon Musk tweet you read.
And late Monday, Snap issued a rather dire profit warning, saying that “the macroeconomic environment has deteriorated further and faster than anticipated,” since just last month.
All social media competes for advertising money, which is increasingly under threat from spiking inflation and also changes at Apple Inc. that can restrict the information social media platforms can collect on users, a big selling point for advertisers.
Shares of Snap plunged 40% at the opening bell Tuesday and shares of Meta Platforms, Twitter and Alphabet all slumped alongside it.