Technology’s powerful ad sales are beginning to break from Trump’s trade war

The digital advertising market has been sunny enough for investors in the past quarter, offering something that could be the last time before the looming economic storm from the onslaught of President Donald Trump’s tariffs.

Wall Street cheered for first quarter results like the tech giant Meta and alphabetboth saw stocks increase in strong revenues and revenues that beat analyst expectations.

The strong number of online ads Titans faced with financial worries has shown that businesses are still willing to promote their products and services to consumers on the internet.

Amazon’s The fast-growing online ad unit also has surpassed quarterly analyst estimates. Advertising sales for online retail giants in the first quarter increased 19% year-on-year to 16% and 9% respectively.

Like small social media and online advertising companies reddit, snap and Pinterest We have posted sales for the first quarter that surpassed Wall Street’s forecast. And even advertising technology companies Applovin and Trade desk We posted strong quarterly revenue.

Applovin’s shares surged nearly 15% on Wednesday after mobile advertising technology providers said they would surpass analyst estimates and sell the Tripledot Studios mobile gaming business.

Shares in TradeDesk rose 18% on Friday, a day after the ad tech company reported first-quarter revenue.

But when it was time for executives to discuss the rest of the year, the celebration stopped.

Susan Lee, chief financial officer of Meta, said last week that “Asia-based e-commerce exporters” were not spending on digital advertising due to the suspension of loopholes in the De Minimis trade that benefited retail upstarts and heavy Facebook spenders like Temu and Shein.

“It’s hard to know how things will unfold over a quarter, very early on, and certainly, it’s hard to know for the rest of the year,” Lee said in a call with an analyst.

Alphabet and Pinterest executives shared similar sentiments about Asian-specific ad sales and broader macroeconomic uncertainty, slower towards the rest of the year. SNAP went to extract second quarter guidance on an unpredictable economy that could reduce corporate advertising budgets for the remainder of the year.

Jeff Green, CEO of The Trade Desk, also mentioned Thursday’s challenging economy, saying marketers are facing “critical times” as they work “among increasing macrovolatility to start the year.”

“The good news is that the first quarter was very strong and the fourth quarter last year was pretty good,” said Sameer Samana, Global Equity and Real Assets Director at Wells Fargo Investment Institute.

However, companies in various sectors may even lower or suspend sales guidance for 2025, as with automotive giants. Ford Motor and Toymaker MattelSamana believes that good times are likely to be coming to an end.

“What I’m telling me is to enjoy this gathering more often, and enjoy these good numbers more,” Samana said. “This will be as good as next year.”

Businesses like the ominous signs of social media and online advertising companies, retail and consumer packaging products business Proctor & Gamble It warns that sales will weaken amid the turbulent economy.

Jasmine Enberg, vice president and chief analyst at Emarketer, said companies in these sectors would generate “about half of all social ads in the US,” and that lower advertising spending would “have a ripple effect on the social ad market.”

Enberg believes that a potential slowdown in ad spending will hurt smaller tech platforms than their larger rivals.

“I think what we’re likely to see is what we tend to see in an age of economic uncertainty. That means advertisers are looking to get refuge in a larger platform that provides scale and consistent ROI,” Enberg says.

But even tech giants like Meta may experience some economic distress, explained Greg Silverman, global director of brand economics at consulting firm Interbrand.

Silverman said other retailers may decide to run Facebook ads as China-related retailers like Temu are backing down, but these promotional campaigns aren’t in the advantage for these companies.

Temu was willing to spend a lot of money on Facebook ads, as he previously benefited from a loophole in the De Minimis trade, Silverman said. And it’s unlikely that US retailers will do the same, particularly with rattling supply chains and high tariffs potentially increasing product costs.

“The AD returns that Temu had reached Facebook will be difficult for anyone else to replicate,” Silverman said.

For Wells Fargo’s Samana, current economic uncertainty can be traced back to trading policies and tariffs and subsequent influences across the market.

“We started the year at a very low level with tariffs,” Samana said. “The tariffs at the end of this will be higher and they will be meaningfully higher. That’s not good for the market. I think that’s the only point that matters.”

Watch: There are positive growth policies on the horizon.