Digital ad market shows signs of sharp rebound as Meta, Amazon point to growth
Drew Angerer | Getty Images News | Getty Images
A year ago, Meta finance chief Susan Li offered chilling commentary about the state of the digital ad market, telling analysts that the struggling industry would remain in a slump.
Speaking to analysts on the company’s fourth-quarter earnings call, Li said at the time that Facebook’s revenue “remained under pressure from weak advertising demand” and that sales would continue “to be impacted by the uncertain and volatile macroeconomic landscape.”
During that period Meta’s ad revenue fell 4%, and Google’s ad business suffered a similar drop. Inflation, supply chain issues and global conflict were all depressing spending.
The narrative is very different now.
With results in from Alphabet, Meta and Amazon — the three U.S. leaders in digital advertising — it’s clear that the market has rebounded, at least for the time being.
Meta’s fourth-quarter ad sales jumped 24% from a year earlier to $38.7 billion, while Amazon’s booming ad unit rose 27% to $14.7 billion. Meanwhile Alphabet, still the market leader, saw its Google ad business rise 11% to $65.5 billion, boosted by 16% growth at YouTube.
Debra Aho Williamson, principal analyst at Insider Intelligence, told CNBC that big advertiser events like the Summer Olympics in Paris and the upcoming presidential elections will contribute to higher spending. Insider Intelligence said in a recent report that global ad spending will jump 10% in 2024, up from growth of 6.3% in 2023 and the same level of expansion the prior year.
“After two years of relative malaise, the outlook is very positive on a global scale and in every major region,” the report said.
Analysts at William Blair expressed similar sentiment. They said businesses appear less concerned with the Russia-Ukraine conflict than in the past and are seeing a potentially more favorable interest rate outlook.
“The current macroeconomic environment is continuing to improve for digital advertising,” they wrote, adding that investments by Meta and Alphabet into artificial intelligence to improve their ad platforms are paying off.
Investors will get additional data on the digital ad market when Snap and Pinterest report earnings this week. Those numbers could look quite different, Williamson said, because they’re “much smaller companies that have struggled to build substantial ad businesses, and in this environment, the big are getting bigger.”
On the whole, “digital advertising is continuing to eat up share” of worldwide advertising, Williamson said.
Whether the big players can maintain the momentum is a question that will persist for the coming quarters. One reason growth looks so strong now is because the numbers are being compared to the year-ago period, when conditions were bleak.
Another bump is coming from China-based advertisers, which are spending heavily to reach users across the globe. Meta said that sales from China represented 10% of revenue last year, and accounted for 5 percentage points of growth. Analysts have said online retailers Temu and Shein are the biggest contributors to Meta’s China business, and have raised concerns that such spending may not last.
Regarding Meta’s China business, Li told analysts last week that “the level of growth in 2023 will probably be hard to replicate, but we’ll just keep watching this and see how it plays out.”
Analysts at Bank of America Global Research warned in a note on Friday that investors shouldn’t look past the conflict in the Red Sea, which is causing supply chain bottlenecks and could lead ecommerce companies to reduce their ad spending.
“We think exposure for Alphabet & Meta is very modest,” they wrote.
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Chief executive officer of Google Sundar Pichai.
Marek Antoni Iwanczuk | Sopa Images | Lightrocket | Getty Images
Google on Friday made the latest a splash in the AI talent wars, announcing an agreement to bring in Varun Mohan, co-founder and CEO of artificial intelligence coding startup Windsurf.
As part of the deal, Google will also hire other senior Windsurf research and development employees. Google is not investing in Windsurf, but the search giant will take a nonexclusive license to certain Windsurf technology, according to a person familiar with the matter. Windsurf remains free to license its technology to others.
“We’re excited to welcome some top AI coding talent from Windsurf’s team to Google DeepMind to advance our work in agentic coding,” a Google spokesperson wrote in an email. “We’re excited to continue bringing the benefits of Gemini to software developers everywhere.”
The deal between Google and Windsurf comes after the AI coding startup had been in talks with OpenAI for a $3 billion acquisition deal, CNBC reported in April. OpenAI did not immediately respond to a request for comment.
The move ratchets up the talent war in AI particularly among prominent companies. Meta has made lucrative job offers to several employees at OpenAI in recent weeks. Most notably, the Facebook parent added Scale AI founder Alexandr Wang to lead its AI strategy as part of a $14.3 billion investment into his startup.
Douglas Chen, another Windsurf co-founder, will be among those joining Google in the deal, Jeff Wang, the startup’s new interim CEO and its head of business for the past two years, wrote in a post on X.
“Most of Windsurf’s world-class team will continue to build the Windsurf product with the goal of maximizing its impact in the enterprise,” Wang wrote.
Windsurf has become more popular this year as an option for so-called vibe coding, which is the process of using new age AI tools to write code. Developers and non-developers have embraced the concept, leading to more revenue for Windsurf and competitors, such as Cursor, which OpenAI also looked at buying. All the interest has led investors to assign higher valuations to the startups.
This isn’t the first time Google has hired select people out of a startup. It did the same with Character.AI last summer. Amazon and Microsoft have also absorbed AI talent in this fashion, with the Adept and Inflection deals, respectively.
Microsoft is pushing an agent mode in its Visual Studio Code editor for vibe coding. In April, Microsoft CEO Satya Nadella said AI is composing as much of 30% of his company’s code.
The Verge reported the Google-Windsurf deal earlier on Friday.
Technology
Nvidia’s Jensen Huang sells more than $36 million in stock, catches Warren Buffett in net worth
Jensen Huang, CEO of Nvidia, holds a motherboard as he speaks during the Viva Technology conference dedicated to innovation and startups at Porte de Versailles exhibition center in Paris, France, on June 11, 2025.
Gonzalo Fuentes | Reuters
Nvidia CEO Jensen Huang unloaded roughly $36.4 million worth of stock in the leading artificial intelligence chipmaker, according to a U.S. Securities and Exchange Commission filing.
The sale, which totals 225,000 shares, comes as part of Huang’s previously adopted plan in March to unload up to 6 million shares of Nvidia through the end of the year. He sold his first batch of stock from the agreement in June, equaling about $15 million.
Last year, the tech executive sold about $700 million worth of shares as part of a prearranged plan. Nvidia stock climbed about 1% Friday.
Huang’s net worth has skyrocketed as investors bet on Nvidia’s AI dominance and graphics processing units powering large language models.
The 62-year-old’s wealth has grown by more than a quarter, or about $29 billion, since the start of 2025 alone, based on Bloomberg’s Billionaires Index. His net worth last stood at $143 billion in the index, putting him neck-and-neck with Berkshire Hathaway‘s Warren Buffett at $144 billion.
Shortly after the market opened Friday, Fortune‘s analysis of net worth had Huang ahead of Buffett, with the Nvidia CEO at $143.7 billion and the Oracle of Omaha at $142.1 billion.
The company has also achieved its own notable milestones this year, as it prospers off the AI boom.
On Wednesday, the Santa Clara, California-based chipmaker became the first company to top a $4 trillion market capitalization, beating out both Microsoft and Apple. The chipmaker closed above that milestone Thursday as CNBC reported that the technology titan met with President Donald Trump.
Brooke Seawell, venture partner at New Enterprise Associates, sold about $24 million worth of Nvidia shares, according to an SEC filing. Seawell has been on the company’s board since 1997, according to the company.
Huang still holds more than 858 million shares of Nvidia, both directly and indirectly, in different partnerships and trusts.
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