Ad mogul sees Meta rebounding 'extremely strongly,' Amazon ad revenue hitting $100 billion

Advertising titan Martin Sorrell believes Meta volition rebound "extremely powerfully this year" and sees a promising outlook for U.S. tech giants, contempt a bruising 2022 and wide layoffs.

U.S. tech companies person fto spell of much than 60,000 employees successful the past year, arsenic slowing economical growth, higher involvement rates successful effect to soaring ostentation and competitory challenges squeezed margins and hammered the banal prices of tech behemoths.

Facebook genitor Meta successful November announced plans to eliminate 13% of its staff, amounting to much than 11,000 employees. It besides issued bleak fourth-quarter guidance that wiped retired astir a 4th of its marketplace cap, pushing the banal to its lowest since 2016.

A wide slowdown successful online advertisement spending and contention from caller rivals specified arsenic TikTok, on with challenges associated with privateness changes to Apple's iOS, person hampered the societal media group's business implicit the past year.

The institution has besides taken a important deed from its monolithic concern successful gathering its augmented world satellite known arsenic the metaverse — a strategy that has proven divisive among analysts and investors.

Sorrell, enforcement president of U.K. advertizing bureau S4 Capital, expects Meta to code astir of its concern challenges successful 2023, portion benefiting from China's reopening.

"I deliberation you'll spot Meta travel backmost highly powerfully this year, connected the backmost of reels and concern messenger, to woody with the contention from TikTok and different abbreviated signifier video competitors," Sorrell told CNBC connected the sidelines of the World Economic Forum successful Davos, Switzerland.

"Google had a coagulated twelvemonth past year, and I deliberation they'll person a beardown twelvemonth this year. Amazon accrued its advertizing revenues from $31bn to $41bn, and I deliberation [it] volition deed $100bn successful time, contempt what you're seeing successful presumption of jobs and hiring."

He besides suggested that the reopening of the Chinese system would beryllium "huge" for large tech firms, noting that outbound Chinese business, oregon Chinese companies expanding their businesses abroad, were historically the second-largest nett centers for the likes of Meta, Amazon and Google genitor Alphabet.

Sorrell launched S4, which operates successful some the integer advertizing and integer translation spaces, aft leaving advertisement elephantine WPP successful 2018. S4 connected Wednesday confirmed its full-year guidance, and Sorrell said his clients' advertizing spending priorities successful 2023 would beryllium "topline maturation successful activation and performance" and "reducing [the] outgo of integer transformation."