Coronavirus: Facebook Ad Revenue Likely to Suffer

Analysts are warning that Facebook’s ad revenue business may be impacted as a result of the spread of the coronavirus....
Coronavirus: Facebook Ad Revenue Likely to Suffer
Written by Matt Milano

Analysts are warning that Facebook’s ad revenue business may be impacted as a result of the spread of the coronavirus.

The coronavirus has been having significant impact on a number of industries, especially those that rely on Chinese manufacturing. Apple has warned it will miss its quarterly guidance as a result of delays to iPhone production, and Microsoft has similarly warned its Windows unit would miss expectations, likely because of delays to PC manufacturing.

Needham analysts are now saying the coronavirus will hit even digital businesses, such as Facebook’s ad revenue. According to CNBC, “in a research note Friday, analysts Laura Martin and Dan Medina wrote that channel checks show lower spending in travel, retail, consumer packaged goods and entertainment, which together represent 30% to 45% of Facebook’s total revenue. They also wrote that six of the largest 10 advertising countries are ‘currently COVID-19 hotspots.’”

As a result, the analysts have lowered their estimates for Facebook’s revenue for the first part of 2020, although they expect the crisis to calm by mid-June.

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