Overview

• Meta's ad revenue is expected to drop by $7 billion in 2025 due to Chinese advertisers scaling back amid U.S.-China trade tensions, according to MoffettNathanson analysts.
• Chinese companies contributed $18.35 billion to Meta's revenue in 2024, representing over 11% of the company's total sales.
• Temu has already reduced its U.S. digital ad spending by 31% from March 31 to April 13, highlighting the immediate impact of the tariffs.
• A prolonged economic downturn, coupled with escalating trade disputes, could result in a worst-case scenario of $23 billion in lost revenue for Meta and a 25% drop in 2025 earnings.
• Despite the challenges, MoffettNathanson has maintained a Buy rating on Meta but lowered its price target from $710 to $525.