Amazon and Meta could be big losers from President Donald Trump’s new tariffs, ad industry analysts and insiders said.
Trump announced a baseline 10% tariff on products coming from all countries outside the US, but the tax is higher for certain ones. Those include China, which effectively faces a 54% tariff. Tech stocks fell sharply on the news.
Amazon and Meta get a lot of business from Chinese advertisers that are trying to reach American shoppers, and they could pause advertising or lose business.
“Retail media and digital media will be significantly impacted by these tariffs, especially because products shipped from China and Vietnam are meaningful to Meta and Amazon,” Brian Wieser, a veteran advertising analyst, wrote in a note.
He estimated around $10 billion of Meta’s US revenue comes from advertisers outside of US, mostly from China, and cited research showing China represents half of Amazon’s top sellers on its marketplace in the US, which is likely its biggest ad driver.
Eric Haggstrom, director of market intelligence at Advertiser Perceptions, said the most immediate impact would be on quick-turn products like apparel and home goods.
“The biggest losers you’re going to see right now are companies based on Chinese-based advertising: social media and retail media,” he said.
Ad analysts stressed that tariffs would affect every product category and ad seller because of the global nature of many supply chains. Apple, notably, will likely get hit hard because China is its biggest manufacturing hub. But the situation is so fluid that it’s impossible to predict with any certainty at this point.
“There’s no sector that doesn’t get hit by this,” Wieser said.
Others argued that Amazon, Meta, and search ad-driven Google would be resilient because of their scale, measurability, and ability to drive outcomes.
“The retail media outlets are going to continue to win,” said Nadja Bellan-White, CEO of M&C North America, adding that advertisers’ expectations for performance guarantees will be greater than ever. “They want to know if they spend X amount, they’re going to get X result.”
NewStreet Research analysts wrote that Pinterest, Reddit, and Snap would be the most challenged from an ad standpoint because they have smaller user bases than the likes of Meta. Reddit, for example, has strong user communities but a specific vibe that takes extra work for an advertiser to fit into. Big advertisers could retreat to the platforms they are most familiar with.
The tariffs upheaval comes as the ad industry prepares for its biggest showcase of the year, the television upfronts, when TV giants try to lock in large chunks of ad inventory.
“Advertisers are still going to want to lock in dollars when they need to run ads tied to product launches,” Haggstrom said. “Advertisers want to make sure they are able to place their advertising at the right time. But these negotiations might take longer due to the whole economic and fiscal situation. This is a pretty major shock.”
Live sports is driving a lot of the TV market because of its big, reliable, and ad-friendly audience, which could benefit players like Disney and NBCUniversal.
Sports is the watchword for advertisers as they worry about political backlash, longtime ad industry player Michael Kassan said.
“It’s the safest place to be,” he said.
Another view is that advertisers could be hesitant to lock themselves into big TV buy and could shift spending to always-available digital channels.
How Disney, Netflix, and WBD could be impacted
As for other media and entertainment companies, economic weakness that results from the tariffs could hurt those that rely on consumer spending, Morningstar analysts wrote. Most of those companies also make money from advertising and could see some slowdown there.
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Media and entertainment stocks nosedived on the tariffs news.
Disney’s parks and experiences generate most of its profit, and a recession would likely depress tourism and reduce attendance in that business. Disney’s improving streaming business could make up for weakness in its experiences, though, the Morningstar analysts wrote.
Warner Bros. Discovery also has had recent streaming success that could provide a buffer, but it still has a big debt burden that could make it vulnerable if the credit markets tighten, the analysts wrote.
Netflix doesn’t have the Disney-like moat of experiences to protect it, but it has a service that has reached utility-level status. That makes it unlikely that subscribers would cancel in droves, Morningstar analysts wrote.
Bernstein analysts, however, wrote that Netflix’s growth abroad could slow if Europe imposes retaliatory tariffs. Netflix is the top streaming video service in the five largest European markets.
The company that remains the biggest wildcard: TikTok.
Some advertisers are embracing its ability to drive outcomes, thanks to steps it’s taken to make it easier for marketers to manage and measure ad campaigns, NewStreet Research analysts wrote. However, other advertisers continue to hold back because of its potential for a ban or sale. Adding to the murkiness, its future could be tied to the tariffs, with Trump suggesting he could try to use them as a bargaining chip to get China to allow a sale of the app.
