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A new video by Inspired by Iceland pushes back against experiencing life through the “metaverse,” as described by Mark Zuckerberg during Facebook’s rebranding to Meta on Thursday, Oct. 28, 2021.

Michael Nagle | Bloomberg | Getty Images

Wall Street is bracing for disaster in online advertising.

Following disappointing results from Snap last week and a 28% plunge in the stock price that sent the company’s value to its lowest since early 2019, investors are now turning their attention to ad giants Meta and Alphabet as well as reports this week from Twitter and Pinterest. They’ll also hear from Amazon and Microsoft, which have big ad businesses of their own.

The flurry of reports comes at a time of extreme skepticism in web and mobile advertising. Facebook parent Meta shares are down more than 60% this year, and the company is expected to report a second straight drop in revenue. Alphabet, which has slid 30% in 2022, is forecast to report single-digit sales growth. Aside from one quarter at the beginning of the pandemic, that would mark the weakest period for Google’s parent since 2013.

The economic downturn and fears of a recession have many marketers reining in spending. At the same time, Apple’s iOS privacy change from last year continues to punish companies — notably Snap and Facebook — that have historically relied on user data to target ads.

“Sentiment in the online advertising space has softened of late, with more anecdotes of budget cuts as well as advertisers holding back some budget in hopes of a 4Q flush,” UBS analysts wrote in a report last week. “Looking into ’23, we think planning amidst this level of macro uncertainty sets the stage for below-consensus growth in ’23, even if macro does not significantly deteriorate from here.”

UBS said it would “reduce estimates and price targets across the online advertising group” due to both the economic environment and a strong U.S. dollar. Through discussions with digital ad agencies, the analysts said they learned that “many advertising directors are pulling back certain budgets, particularly among smaller advertisers.”

In Snap’s report on Thursday, the company said results are being hit by a combination of platform changes, economic challenges and competition. For a second straight quarter, Snap said it wouldn’t be providing guidance for the coming period because of difficulty in predicting the economic trajectory.

Digital ad stocks in 2022

CNBC

“We are finding that our advertising partners across many industries are decreasing their marketing budgets, especially in the face of operating environment headwinds, inflation-driven cost pressures and rising costs of capital,” Snap said.

If the third quarter mirrors the second, Snap’s brutal report could spell dismal results for its industry peers. In July, Meta, Twitter, Pinterest, and Google all reported weaker-than-expected results following Snap’s miss.

Investors started planning ahead last week, sending Pinterest shares down more than 6% on Friday after Snap’s report. Twitter fell almost 5% and Meta dropped more than 1%. Alphabet rose over 1%, but still underperformed the tech-heavy Nasdaq, which jumped 2.3%.

CNBC’s Jim Cramer and the Investing Club said there’s a chance Snap’s poor results won’t reflect the overall online advertising market. Meta and Alphabet “have built multifaceted digital ecosystems” that dwarf the smaller Snap, thus making those companies “more immune from weaker digital ad spend,” the Investing Club wrote.

The industry drama this week isn’t limited to earnings reports.

Tesla CEO Elon Musk has until Friday to close his proposed $44 billion acquisition of Twitter if he wants to avoid a trial. After changing his mind on the deal multiple times and being sued, Musk said earlier this month that he wanted to complete the transaction at the originally agreed upon price of $54.20 a share. Twitter wants to make sure the financing is in place before backing off the lawsuit.

Twitter shares closed last week below $50, suggesting investors still aren’t convinced the deal will close. Meanwhile, the business has been struggling. Analysts are anticipating a drop in third-quarter revenue in the company’s earnings report, which is expected this week.

One bright spot in the online advertising space could be Amazon after its digital ad business grew 18% in the second quarter, topping all of the major players in the industry.

While retailers may be pulling back on spending on Facebook and elsewhere, Amazon is a stickier platform for them because people who use it are shopping for stuff. For companies to keep their brands visible on the largest e-commerce site, they have to pay the platform.

But even Amazon’s core business has suffered this year, with growth slowing dramatically from its boom days during the pandemic. Overall revenue expansion was in the single digits for three straight quarters and the stock is down 28% for the year.

By the time Amazon closes out Big Tech earnings week on Thursday, investors should have a much clearer picture of the online ad market and how much companies are tightening their belts heading into the holiday season.

WATCH: Snap has been the victim of budgets moving over to TikTok

Snap is the victim of budgets moving to TikTok, says JMP's Andrew Boone

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Amazon was questioned by House China committee over ‘dangerous and unwise’ TikTok partnership

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Amazon was questioned by House China committee over 'dangerous and unwise' TikTok partnership

Amazon logo on a brick building exterior, San Francisco, California, August 20, 2024.

Smith Collection | Gado | Archive Photos | Getty Images

Amazon representatives met with the House China committee in recent months to discuss lawmaker concerns over the company’s partnership with TikTok, CNBC confirmed.

A spokesperson for the House Select Committee on the Chinese Communist Party confirmed the meeting, which centered on a shopping deal between Amazon and TikTok announced in August. The agreement allows users of TikTok, owned by China’s ByteDance, to link their account with Amazon and make purchases from the site without leaving TikTok.

“The Select Committee conveyed to Amazon that it is dangerous and unwise for Amazon to partner with TikTok given the grave national security threat the app poses,” the spokesperson said. The parties met in September, according to Bloomberg, which first reported the news.

Representatives from Amazon and TikTok did not immediately respond to CNBC’s request for comment.

TikTok’s future viability in the U.S. is uncertain. In April, President Joe Biden signed a law that requires ByteDance to sell TikTok by Jan. 19. If TikTok fails to cut ties with its parent company, app stores and internet hosting services would be prohibited from offering the app.

President-elect Donald Trump could rescue TikTok from a potential U.S. ban. He promised on the campaign trail that he would “save” TikTok, and said in a March interview with CNBC’s “Squawk Box” that “there’s a lot of good and there’s a lot of bad” with the app.

In his first administration, Trump had tried to implement a TikTok ban. He changed his stance around the time he met with billionaire Jeff Yass. The Republican megadonor’s trading firm, Susquehanna International Group, owns a 15% stake in ByteDance, while Yass has a 7% stake in the company, NBC and CNBC reported in March.

— CNBC’s Jonathan Vanian contributed to this report.

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Amazon launches fixed pricing for treatment of conditions such as hair loss. Hims & Hers stock drops 15%

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Amazon launches fixed pricing for treatment of conditions such as hair loss. Hims & Hers stock drops 15%

A worker delivers Amazon packages in San Francisco on Oct. 24, 2024.

David Paul Morris | Bloomberg | Getty Images

Amazon on Thursday announced Prime members can access new fixed pricing for treatment of conditions like erectile dysfunction and men’s hair loss, its latest effort to compete with other direct-to-consumer marketplaces such as Hims & Hers Health and Ro.

Shares of Hims & Hers fell as much as 17% on Thursday, on pace for its worst day.

Amazon said in a blog post that Prime members can see the cost of a telehealth visit and their desired treatment before they decide to proceed with care for five common issues. Patients can access treatment for anti-aging skin care starting at $10 a month; motion sickness for $2 per use; erectile dysfunction at $19 a month; eyelash growth at $43 a month, and men’s hair loss for $16 a month by using Amazon’s savings benefit Prime Rx at checkout.

Amazon acquired primary care provider One Medical for roughly $3.9 billion in July 2022, and Thursday’s announcement builds on its existing pay-per-visit telehealth offering. Video visits through the service cost $49, and messaging visits cost $29 where available. Users can get treatment for more than 30 common conditions, including sinus infection and pink eye.

Medications filled through Amazon Pharmacy are eligible for discounted pricing and will be delivered to patients’ doors in standard Amazon packaging. Prime members will pay for the consultation and medication, but there are no additional fees, the blog post said.

Amazon has been trying to break into the lucrative health-care sector for years. The company launched its own online pharmacy in 2020 following its acquisition of PillPack in 2018. Amazon introduced, and later shuttered, a telehealth service called Amazon Care, as well as a line of health and wellness devices.

The company has also discontinued a secretive effort to develop an at-home fertility tracker, CNBC reported Wednesday.

— CNBC’s Annie Palmer contributed to this report.

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WikiLeaks whistleblower Chelsea Manning says censorship is still ‘a dominant threat’

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WikiLeaks whistleblower Chelsea Manning says censorship is still 'a dominant threat'

Chelsea Manning: Censorship still a dominant threat

Former U.S. Army intelligence analyst Chelsea Manning says censorship is still “a dominant threat,” advocating for a more decentralized internet to help better protect individuals online.

Her comments come amid ongoing tension linked to online safety rules, with some tech executives recently seeking to push back over content moderation concerns.

Speaking to CNBC’s Karen Tso at the Web Summit tech conference in Lisbon, Portugal, on Wednesday, Manning said that one way to ensure online privacy could be “decentralized identification,” which gives individuals the ability to control their own data.

“Censorship is a dominant threat. I think that it is a question of who’s doing the censoring, and what the purpose is — and also censorship in the 21st century is more about whether or not you’re boosted through like an algorithm, and how the fine-tuning of that seems to work,” Manning said.

“I think that social media and the monopolies of social media have sort of gotten us used to the fact that certain things that drive engagement will be attractive,” she added.

“One of the ways that we can sort of countervail that is to go back to the more decentralized and distribute the internet of the early ’90s, but make that available to more people.”

Nym Technologies Chief Security Officer Chelsea Manning at a press conference held with Nym Technologies CEO Harry Halpin in the Media Village to present NymVPN during the second day of Web Summit on November 13, 2024 in Lisbon, Portugal. 

Horacio Villalobos | Getty Images News | Getty Images

Asked how tech companies could make money in such a scenario, Manning said there would have to be “a better social contract” put in place to determine how information is shared and accessed.

“One of the things about distributed or decentralized identification is that through encryption you’re able to sort of check the box yourself, instead of having to depend on the company to provide you with a check box or an accept here, you’re making that decision from a technical perspective,” Manning said.

‘No longer secrecy versus transparency’

Manning, who works as a security consultant at Nym Technologies, a company that specializes in online privacy and security, was convicted of espionage and other charges at a court-martial in 2013 for leaking a trove of secret military files to online media publisher WikiLeaks.

She was sentenced to 35 years in prison, but was later released in 2017, when former U.S. President Barack Obama commuted her sentence.

Asked to what extent the environment has changed for whistleblowers today, Manning said, “We’re at an interesting time because information is everywhere. We have more information than ever.”

She added, “Countries and governments no longer seem to invest the same amount of time and effort in hiding information and keeping secrets. What countries seem to be doing now is they seem to be spending more time and energy spreading misinformation and disinformation.”

Manning said the challenge for whistleblowers now is to sort through the information to understand what is verifiable and authentic.

“It’s no longer secrecy versus transparency,” she added.

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