Ad growth slows

President Trump's economic policies will slow advertising growth in the U.S. through at least 2027, according to a new projection.

Why it matters: While analysts anticipated unpredictability with a new administration, the extent of economic volatility has proven greater than previously expected, according to Brian Wieser, a top advertising analyst.

• Specifically, the president's trade policies pose a more extreme threat to supply chains and corporate decision-making than previously expected.

State of play: In a new forecast published today, Wieser said he is reducing his expectations for U.S. advertising growth in 2025 and beyond, calling for 3.6% growth this year (excluding political advertising), down from his previous projection of 4.5%.

• That slowdown will feel more prominent in the second half of the year — when the full consequences of new policy changes are felt.
• He expects a similarly downgraded range at least through 2027 as the economy adjusts to new policies. The 2028 Olympics should help to accelerate spending beyond that.

Reality check: While this level of growth isn't so bad in historical terms, "it is below what the industry has become accustomed to, where growth rates were unsustainable," Wieser said.

• The 2010s saw an unprecedented level of ad growth as the internet created more opportunities to grow the overall advertising pie.
• Now that the digital advertising industry has reached maturity, growth has naturally slowed, but publishers are still adjusting to that new reality in the wake of the pandemic.

Case in point: There continues to be a steady flow of layoffs and job cuts across the media industry as companies try to offset a slower ad market and adjust to a new economic reality.

• Disney's ABC News Group and Disney Entertainment Networks laid off around 200 people earlier this month. CNN cut 200 positions. MSNBC laid off 99 people. The Wall Street Journal, Dotdash, Scripps, the Washington Post, HuffPost, Forbes and others have all experienced cuts this year.

The big picture: For the past decade, political advertising has been a strong source of growth for U.S. publishers, especially local broadcasters, but Wieser expects that fewer competitive congressional seats will slow political advertising growth for the foreseeable future.

• Inflation will also continue to eat into consumer spending across experiences and subscriptions.
• Movie ticket sales are down from the same time period in 2024. Theaters aren't expected to ever fully recover from the pandemic.

What to watch: There's hope that new policy proposals won't all materialize, providing some relief for the industry.

• Trump has suspended tariffs on small packages from China, which should enable continued spend by tech giants like Temu, Shein and TikTok in the U.S.
• Threats to ban or limit pharmaceutical TV ads haven't been realized and are expected to hit legal roadblocks if regulators try.