Analysts forecast that Facebook could lose between 1% and 5% of its revenue.<\/b>
\nWith over 500 companies having now joined the advertising boycott of Facebook called for by top civil rights groups, some investors are concerned about the company\u2019s lost revenue\u2014but most Wall Street firms estimate that Facebook is still looking at less than a 5% hit to overall revenue.
\u201cAs important as these advertisers are to Facebook, it would likely take a far broader advertising boycott over a longer period of time to materially impact Facebook\u2019s ad revenue,\u201d Stifel analysts said in a recent note.
According to advertising database Pathmatics, the top 100 highest ad spenders on Facebook only accounted for around 6% of its entire revenue. What\u2019s more, \u201csocial platforms are typically able to replace lost advertisers with other advertisers given the auction dynamics of the platforms,\u201d Bank of America analysts said in a recent note.
Facebook responded to the ad boycotts on Wednesday. The company\u2019s vice president of global affairs, Nick Clegg, said in a statement that \u201cFacebook does not profit from hate.\u201d He argued that the social media platform actually removes hate speech faster than rivals like Twitter and YouTube.
That\u2019s how much Facebook generated in advertising revenue last year, trailing only Google as the second-largest digital marketer.
The Facebook ad boycotts stem from the #StopHateforProfits campaign announced by a coalition of civil-rights and other groups, including the Anti-Defamation League and the National Association for the Advancement of Colored People. A growing list of major brands\u2014including Starbucks, Pfizer, Target, Best Buy, Verizon and Coca-Cola\u2014have all agreed to not work with the tech giant until \u201cmeaningful action\u201d is taken to address misinformation and hate speech.
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