Meta reports ad revenue slowdown after EU’s less‑personalized ad rules take effect

Meta disclosed in its Wednesday earnings briefing that growth in its advertising revenue has decelerated since the European Union rolled out its "Less Personalized Ads" framework at the start of the year.

The EU initiative, part of a broader push for digital privacy, gives users the option to see ads that are not tailored to their individual browsing history. It builds on earlier regulations such as the General Data Protection Regulation and reflects growing demand for greater control over personal data.

During the briefing, Meta said the company continues to generate strong overall revenue, but the pace of ad sales in Europe has softened compared with previous quarters. The slowdown was attributed specifically to the reduced ability to use detailed user data for targeting, a core component of Meta’s advertising model.

Advertisers traditionally rely on precise audience segmentation to achieve higher click‑through rates and return on investment. With the new rules limiting the granularity of data that can be applied, many marketers are shifting toward broader, contextual ad placements, which tend to deliver lower performance metrics. The change affects Meta’s flagship platforms, including Facebook and Instagram, where personalized feeds have been a key revenue driver.

Industry analysts note that Meta’s experience mirrors a wider trend across the digital ad ecosystem, as regulators in several jurisdictions tighten data‑use rules. Companies are responding by investing in AI‑powered contextual targeting and exploring alternative pricing models that do not depend on personal data.

Looking ahead, Meta indicated it will monitor the regulatory environment closely and adapt its ad products to maintain effectiveness while complying with user‑choice options. The company plans to roll out new ad formats that emphasize relevance without relying on individual profiling, a move that could shape its revenue trajectory in the coming quarters.