Facebook says Q3 ad revenue grew 33% YoY to $28.28B but warns of “continued headwinds” in Q4 due to Apple's ATT changes in iOS
remember that FB missed rev expectations too, by almost $600MM). FB acknowledged ATT pain last Q which served its interests this Q Issie Lapowsky / @issielapowsky : Sheryl on Apple's privacy changes: “The accuracy of our ads targeting decreased, which increase the cost of driving outcomes for advertisers, and the other is that measuring those outcomes became more difficult.” Mario Zechner / @badlogicgames : @migueldeicaza Imma let you finish, but Apple's commendable action has had zero effect on Facebook's deprived business antics. https://twitter.com/... Eric Seufert / @eric_seufert : 5/ Overall I feel the same tonight as I did last Q: https://twitter.com/... Sami Fathi / @samifathi_ : New Story: Facebook is attempting to blame Apple for dim performance this quarter, claiming that privacy rules in iOS are “negatively affecting” the business. At the same time, Zuckerberg says the changes could turn out to be in Facebook's favor. Details: https://www.macrumors.com/... https://twitter.com/... Brian Swetland / @dnaltews : @migueldeicaza I'm not here to defend Google (plenty of issues there, many contributing to me deciding to leave), but I have some serious issues with portraying Apple as some scrappy underdog “resistance” movement. Eric Seufert / @eric_seufert : FB earnings: $50BN in buybacks offsets the acknowledged frictions from ATT / IDFA deprecation. Facebook clearly has a plan for remediating ATT frictions. ATT seems mostly baked into the price (FB acknowledged ATT pains last Q and stock was punished after $SNAP call) (1/X) Brian Swetland / @dnaltews : @migueldeicaza Yes, by all means, we should cheer for the megacorp with the most locked down ecosystems, oppressive developer practices, and highest profit margins, actively trying to destroy general purpose compute in favor of centrally controlled vertically integrated appliances. ^^ Jason Kint / @jason_kint : Listen to what Sandberg is saying - Facebook isn't getting full credit for conversions from ads on their platform. Publishers for years have been forced into performance metrics where Google and Facebook claim credit for the advertising. She has no answer on targeting. Ouch. /7 Jason Kint / @jason_kint : I would very much want to know mix of iOS and Android revenue in Q3 2021 vs 2020 - rest of market is headed in iOS direction. Right now, either they're either circumventing apple (unlikely), driving up prices with market power (likely), or recapturing thru Android (probably). /5 Jason Kint / @jason_kint : Snap CEO supported Apple's privacy changes. Sheryl Sandberg is about to lay out all of the problems it's causing for the company while not supporting them and instead trying to still hug small business. Every word should be parsed. /3 Jason Kint / @jason_kint : I'm trying to keep track of his adversaries he's trying to paint and neuter with these prepared remarks: So far I've logged: - apple's privacy improvements - the whistleblower's leaking - free and plural press “coordinating” - antitrust enforcers GTFO with the metaverse. /2 Anthony DeRosa / @anthony : Facebook's ad sales, its primary revenue source, saw slower growth in the first full quarter since Apple in April started requiring apps to ask users whether they want to be tracked $FB https://www.wsj.com/... Sara Fischer / @sarafischer : Zuckerberg opens Facebook earnings call acknowledging @Apple IDFA changes impacting its business then moves to acknowledge Facebook Papers: “What we're seeing is a coordinated effort to selectively use leaked documents to pint a false picture of our company.” Rich Greenfield / @richlightshed : Facebook's Zuckerberg comes out swinging on Q3 2021 earnings call - reiterating Apple's privacy changes as directly hurting small businesses around the world who are trying to recover from the pandemic $FB @Facebook similar to the @nytimes ad Facebook took out earlier this year https://twitter.com/... See also Mediagazer
Context & Ripple Effects
Facebook had already cast Apple as a strategic rival, with Zuckerberg arguing that Apple used its platform position to favor its own communications apps in a broader dispute over platform advantage. The quarter puts a financial mechanism behind that conflict: less precise targeting and harder outcome measurement affect the economics of Facebook's ad system.
The reported miss qualifies the earlier view that digital advertising's secular growth would blunt Apple-related pressure. Later coverage of advertisers shifting some budgets to Google, Amazon, and TikTok shows why Facebook's measurement problem matters beyond one quarter.
First-order effects
- Facebook enters Q4 with weaker ad-targeting accuracy and more difficult conversion measurement, while advertisers face a higher cost to drive outcomes, according to Sheryl Sandberg.
- Despite 33% year-over-year Q3 ad-revenue growth, Facebook's roughly $600M revenue shortfall and ATT warning put immediate attention on the durability of advertiser performance on its platform.
Second-order effects
- Advertisers that cannot reliably measure Facebook campaign outcomes have a practical reason to test spend on Google, Amazon, and TikTok, a reallocation documented in subsequent coverage of ATT-driven budget shifts.
- Apple's privacy controls turn measurement quality into a competitive variable for ad platforms, intensifying Facebook's already-public conflict with an Apple it had labeled a major competitor.
Third-order effects
- If ATT-era measurement constraints persist, mobile advertising competition shifts from audience targeting alone toward which platforms can provide advertisers the most dependable outcome measurement under privacy limits.
- The pattern points toward greater dependence on first-party signals and platform-controlled measurement, concentrating leverage with large ad platforms rather than third-party tracking infrastructure.
The trend: Mobile privacy controls are reshaping digital advertising by making measurable conversion performance, rather than reach alone, a central competitive advantage.