Facebook, Google's promising earnings don't signal broader ad recovery - Business Insider

that ad revenue showed "signs of stability" in the first few weeks of April, with ad revenue essentially flat year-over-year . While stability is certainly better than the massive drop it experienced, it still isn't growth — and Q2 poses even more challenges for the company, especially given the Facebook notably declined to make any official forecasts, due to the uncertainty of how the crisis will pan out.

The less-bleak outlook of the duopoly shouldn't be taken as a sign that recovery for the broader ad ecosystem is on the horizon. Rather, the relative strength of Facebook and Google together — which together already made up of US ad spend in 2019, per eMarketer estimates as of March 2020 — is only likely to increase amid the pandemic, as advertisers look to the two at the expense of their smaller competitors.

"Google and Facebook are more likely to be at the top of any given marketer's digital media plan than their competitors, which will mean ad spending on these platforms is at less risk in times of budget constraints," according to eMarketer principal analyst Nicole Perrin.

And when a broader recovery does come, the duopoly will likely be the first to feel its effects, for a few key reasons: Recovery in other parts of the world will help the companies' earnings level out, even as US and Europe ad spend continues to falter. For example, Facebook ad spend in East Asia is beginning to rebound, up 12.

similar drops — and advertisers that return to the platforms earlier can take advantage of the temporarily low costs and high reach., digital advertising remained steadier than most other ad formats, as advertisers perceived it as more flexible, reliable, and measurable. That perception has likely only strengthened since then, meaning Facebook and Google are likely to be seen as among the safest options for advertisers looking to cautiously resume spending while the economy recovers.

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