Market Implications from Ad Spend Trends

Last week we published a global 1Q25 advertising research report.

Let's briefly recap the conclusions:

• Ad categories related to tariffs have already directly experienced impact, including: automotive, cross-border e-commerce, and certain retail and consumer goods

• New economy categories remain unaffected, including: gaming, internet services, and some e-commerce advertisers

• Automotive has been impacted the most, explicitly mentioned by almost all Agencies we communicated with, not just in the US but even in conversations with European Agencies, where "spillover effects" on automotive advertising budgets were observed due to US tariffs

• Brand budgets shifting to performance advertising

• Smaller platform budgets migrating to larger platforms

• Q1 2025 TikTok budgets shifting to META/GOOG, a trend likely to continue as the TikTok Ban remains unresolved

This is quite a pessimistic conclusion, suggesting that most advertising platforms, even if they didn't miss in Q1 2025, will likely lower their Q2 2025 guidance.

So we must ask ourselves: with stocks having fallen so much, is this already priced in?