Meta Platforms: AI Continues to Drive Revenue, but Is the Stock a Buy?
Going into its first-quarter results, there was a worry about how reduced spending from China-based e-commerce exporters, such as Temu and Shein, would impact Meta Platforms (NASDAQ: META). These worries appeared largely justified, as Chinese e-commerce companies accounted for about 11% of its revenue last year, and data from marketing intelligence company Pathmatics showed Temu's spending on Facebook at one point had suddenly dropped from over $1 million a day to nearly zero. The reduction in ad spending from Chinese e-commerce exporters stems from both the current U.S.-China tariff war as well as the end to the de minimis exemption that allowed goods valued below $800 to enter the U.S. without being subject to tariffs. This de minimis exemption fueled growth for companies like Temu and Shein, which in turn spent heavily on digital advertising within the U.S.Image source: Getty Images.Continue reading
Going into its first-quarter results, there was a worry about how reduced spending from China-based e-commerce exporters, such as Temu and Shein, would impact Meta Platforms (NASDAQ: META). These worries appeared largely justified, as Chinese e-commerce companies accounted for about 11% of its revenue last year, and data from marketing intelligence company Pathmatics showed Temu's spending on Facebook at one point had suddenly dropped from over $1 million a day to nearly zero.
The reduction in ad spending from Chinese e-commerce exporters stems from both the current U.S.-China tariff war as well as the end to the de minimis exemption that allowed goods valued below $800 to enter the U.S. without being subject to tariffs. This de minimis exemption fueled growth for companies like Temu and Shein, which in turn spent heavily on digital advertising within the U.S.
Image source: Getty Images.
