Social media companies, which generate most of their revenue from digital advertising, have been witnessing a slowdown lately due to concerns about an impending recession and a potential reduction in digital ad spending. Social media giant Snap Inc.’s (SNAP) CEO Evan Spiegel warned of slow growth recently. SNAP stated that it might report revenue and adjusted EBITDA below the low end of its previous guidance range due to macroeconomic headwinds and geopolitical instability.
Furthermore, big tech’s digital advertising practices are facing possible regulations. The bipartisan Competition and Transparency in Digital Advertising Act introduced earlier this month intends to increase competition by prohibiting companies that earn more than $20 billion per year in ad revenue from ownership of more than one part of the digital ecosystem and by increasing transparency.
