Meta’s advertising growth in Europe has begun to lose steam now that users can choose ads that rely on less personal data. In the three months ending in September, the company reported that European ad revenue rose 18 percent year‑on‑year, a pace that fell short of its global performance and lagged far behind the 33 percent increase recorded in the United States and Canada.
While the company did not directly attribute the slowdown to its new “Less‑Personalized Ads” (LPA) model, chief financial officer Susan Li had warned in July that the fully rolled‑out offering could become an additional headwind for the region. The two quarters before that had seen ad growth dip from roughly 40 percent to 24 percent, whereas growth in the U.S. and Canada edged up from 30 percent to 31 percent.
Dominic Ball, equity research director at Rothschild & Co Redburn, told WIRED that the EU’s free, less‑personalized advertising option is likely a factor in the European slowdown. Meta introduced the LPA choice for Instagram and Facebook users at the start of the year after EU regulators said the firm had breached the Digital Markets Act by not providing an equivalent service that uses fewer personal data points. The regulators also imposed a €200 million fine.
Since the rollout, sales growth in Europe has decelerated. The European Commission noted that charging users who decline personalized ads for an ad‑free subscription—a plan Meta launched in the EU in November 2023—did not meet the regulatory requirement. Meta has not disclosed how many users have selected each option.
According to the company, LPA ads rely on 90 percent less data than fully personalized ads. They are shown based on a user’s activity during a particular session, combined with basic information such as age, location and gender. Meta warned that this approach delivers weaker returns for European advertisers, produces fewer transactions and prompts more users to close ads because they appear irrelevant or repetitive. The latest results showed that the price advertisers are willing to pay per ad in Europe is not rising as quickly as it is in the United States and Canada.
Li told investors that Meta still has “a lot of runway” to boost ad conversions and efficiency, and that the firm is “continuing to find ways to either enhance the actual performance of the recommendation engine.” Ball believes that, despite the reduced data signals, Meta can leverage artificial intelligence to improve targeting in Europe.
During the earnings call, investors pressed for details on how the new personal AI assistant, Muse, fits into the advertising strategy. Li said users of Muse are already showing strong commercial intent—asking for product recommendations, researching alternatives and comparing options—which should eventually allow the company to tap the advertising market through the AI product.