Digital ad market is finally on the mend, bouncing back from the 'dark days' of 2022

Advertising is so back.

After a brutal 2022, when brands reeled in spending to cope with inflation, and a 2023 defined by layoffs and cost cuts, the top digital advertising companies have started growing again at a healthy clip.

Meta, Snap and Google all reported first-quarter results this week, with revenue growth that exceeded analysts estimates and at rates not seen in at least two years. Their financials were primarily driven by improvements across their ad businesses.

The companies entered earnings season in a favorable position in that their numbers would be comparable to historically weak periods. But investors and analysts were cautious in their expectations, given the political and economic instability in various markets across the globe and the ongoing challenges posed by high consumer prices.

Meta, which was the first in the group to report results, put some fears to rest on Wednesday, showing a 27% jump in first-quarter revenue to $36.5 billion. For the Facebook parent, it was the strongest rate of expansion since 2021.

"When Meta was in its dark days two years ago, the company knew what they had to do to get back on track," analysts at Bernstein wrote in a note after the earnings report. "To their credit, Meta defended the core."

That dark era was defined by the combination of macroeconomic challenges and Apple's iOS privacy change, which made it harder for social media companies to target users with ads. Meta lost two-thirds of its value in 2022 and was forced to dramatically cut headcount.

Meta responded by rebuilding its ad system, with the help of hefty investments in artificial intelligence, so it could deliver value to brands despite the roadblock imposed by Apple. The stock almost tripled in 2023.

While the