Meta Reports Ad Revenue Growth; Netflix Restructures Ad Partnership with Microsoft

by Hannah Dillon on 31st Jul 2023 in News

In today's ExchangeWire news digest: Meta doubles down on metaverse spend as ad business shows recovery; Netflix reworks its ad partnership with Microsoft against sluggish sales; and THG buys freesheet City A.M.

Meta sees ad business rebound

Social media giant Meta has reported its highest quarterly sales growth in two years. Ad revenue grew by around 12% in the second quarter of the year, thanks in part to the company’s use of AI for improved ad targeting. The rebound follows aggressive cuts under Mark Zuckerberg’s “year of efficiency”, however the firm continued to invest in the experimental Reality Labs. Despite the studio bleeding funds, Meta shows no signs of slowing spend on AR development.

Netflix reworks Microsoft partnership, lowers ad prices

With its new ad-supported tier struggling to gain traction, Netflix is restructuring its advertising pact with Microsoft. The software giant gave Netflix a “minimum guarantee” when the two firms partnered last year, promising a large influx of advertising revenue to lower the company’s financial risk. Executives at the streaming giant, however, have been frustrated with Microsoft’s sluggish sales, and the company is now offering lower rates to advertisers in the hope of sparking growth.

THG acquires City A.M. paper

London’s free business newspaper, City A.M., has been bought by THG for an undisclosed sum. The freesheet has been on the brink of administration for some time, with its founders seeking an outright sale after accruing £1.2m in debt by the end of 2021. Commenting on the purchase, THG CEO Matthew Moulding said the company had “long been reviewing opportunities in the disruptive media space”. The billionaire previously lashed out at FT journalists for what he considered unfair coverage of the health and beauty platform.

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