While the recession is feared after the new Trump tariff, American media and Internet companies are facing billions of dollars to spend ads that can provide Death Knell to traditional TV advertisements.
“Given the continuous secular winds facing the ecosystem of linear television, we are concerned that the TV can reflect the fate of the radio and newspapers during the previous recession,” Movitanathson analysts Michael Nathanson and Robert Fishman warned in the report last week.
If there is a recession achieved, then Moffettnathanson estimates that American advertising spending will come with $ 45 billion less than current expectations.
This estimate means a 11.5 -point blow to the growth of revenues in the upper line throughout the media scene. Digital platforms will bear the largest burden, with less than $ 29 billion in spending on ads, as television faces a shortage of $ 12 billion.
Read more: What is the recession, and how does it affect you?
Even before Trump administration announcement on April 2 Among the 10 % foundation tariffs on almost all foreign imports, Moffettnathanson said companies were already in waiting and vision, as the spending of ads remained while commercial policy remained unclear.
Read more: Latest news and updates on Trump’s tariff
It is a blatant reflection of the recovery of the great spending enjoyed by the advertising industry in 2024 against the backdrop of standard political spending, the prosperous economy, and the remaining momentum from the digital boom and e -commerce after the recipe.
But as Moffettnathanson argued, the tone has shifted from “quietly pessimistic” to “more landing”.
“The shift is largely driven by the unconventional and aggressive approach to the current management to address” unfair commercial practices. “” The increased uncertainty after the tariff was announced has led us to adopt a more cautious look of the advertisement, “said analysts.
Companies are highly dependent on the advertisement – such as Meta (Meta), Snap (Snap), and the TTD – “more difficultly difficult”, with the expected stock declines by at least 30 % for each of them, the company is estimated.
Digital players with variable cost structures and less advertisements, such as Netflix (NFLX) and Alphabet (Googl, Googl), “in a better position to overcome the storm.”
Meanwhile, the connected TV operator (Roku) will witness the largest relative effect, turning from positive profits in 2024 to a net loss in 2025 and 2026, according to Moffettnathanson expectations.
