Apple Constantly Causing Facebook and Google Stocks To Diverge!

Shares of Facebook fell to an 18-month low on Thursday after a brutal earnings forecast, while Google fell only slightly from its record close in November.

Will Apple iOS changes trigger a market share shift from Facebook to Google? MKM Partners' Rohit Kulkarni wrote in a report on Thursday. "Yes, we believe so.

While Facebook is in the midst of its biggest share decline ever, trading at an 18-month low, Google remains near a record high and has slightly outperformed everyone.

Their Big Tech peers over the past year. The difference is Apple. Google and Facebook are the two dominant online advertising companies in the US and have been for years.

While the companies do very different things and have faced their own unique problems, the five-year stock charts look pretty similar.

By the end of 2021. Then began Facebook founder Mark Zuckerberg's long struggle to take control of his own destiny, taking a toll on his company's finances.

Facebook apps rely almost entirely on Apple and Google for distribution.

When Apple changed its privacy policy last year, restricting app developers' ability to target users, Facebook was suddenly stripped of one of its most important assets.

While typing in a search query that explains exactly what interests them. When it comes to targeting, Google has Android, the world's most popular operating system, which puts you in control of your own policies.

And while Google still needs iOS distribution, it has a closer relationship with Apple than it does with Facebook.

Google pays Apple billions of dollars a year to be the default search engine in Apple's Safari owner.

When you add it all up, Facebook just told Wall Street that Apple's new Application Tracking Transparency (ATT) feature is expected to cost the social media company $10 billion in revenue this year.

That's a big reason why the company missed its first-quarter revenue guidance and why the stock tumbled 25% on Thursday, its biggest drop to its lowest since August 2020.

In the meantime, Google has been reported with the results of the fourth larger explosion at the beginning of the backrest of a 33% login income, compared to 20% for Facebook.

Analysts, waiting for Google Father Alphabet at the only 23% trimester, while Facebook projected Facebook.

Dave Wehner, CFO of Facebook's parent company Meta, said on Wednesday's conference call with analysts that when it comes to Apple.

Treating search more favorably than other apps because of the Google deal, "clearly the incentive is that this political discrepancy persists. share analysts see the connection.

Advertisers who can no longer achieve the desired targeting on Facebook spend more on Google.

"Have Apple's iOS changes caused a shift in market share from Facebook to Google?"

MKM Partners' Rohit Kulkarni wrote in a report on Thursday. "Yes, we believe so." MKM has a buy rating on both stocks.

Sheryl Sandberg, Facebook's chief operating officer, and former Google executive said Apple's changes are most damaging to small and medium-sized businesses.

which rely more on personalization and targeting of their advertising. We definitely see this having more of an impact on 'SMEs',” he said.

Zuckerberg has been worried about this possibility for a long time.

Without owning the device or operating system, Facebook can’t fully chart its own path and is always subject to the whims of other companies.

Here’s what Facebook said in the risk factors of its IPO prospectus in 2012, which was still the early days of mobile for the company.

We are dependent on the interoperability of Facebook with popular mobile operating systems that we do not control.

Such as Android and iOS, and any changes in such systems that degrade our products’ functionality or give preferential treatment to competitive products could adversely affect Facebook usage on mobile devices.