US Digital Advertising Grew 16% in 2Q25
Following on yesterday’s publication of our updated forecasts for the US and Canadian advertising industries to corporate subscribers and advisory clients, we are publishing a brief summary of digital ad trends below.
In light of a US advertising market that grew 10% in the second quarter, we calculate that digital advertising continues to take share as the medium grew by 16% in the same period. This compares with the 15% growth in digital for 1Q25. Within digital advertising, search grew by approximately 10%, social media platforms and commerce media each grew by around 20%, and other digital grew by 6%.
The largest companies in this category (Google, Meta, and Amazon) have arguably set the bar high for much of the industry’s growth in recent years. However, notable gains have been made by companies such as Walmart, Target, eBay, and TikTok (although TikTok is difficult to assess given the lack of financial disclosures).
Moving forward, we view commerce (or retail) media as having the most headroom, with 19% growth forecast for 3Q25. Commerce platforms have become increasingly effective at causing their customers to become more competitively intensive, and that can have the effect of causing meaningful advertising growth independent of any underlying business growth. Social media will still likely outpace the broader market in 3Q25 (16% vs. 8% for total US advertising, according to our forecast) while search and other digital forecasted lower (7% and 4%, respectively). We have yet to see any tangible results from AI-related search advertising, and we currently do not think this is a large segment of the market. Paid search on AI platforms can certainly be a growth driver for individual companies in the medium term; however, we doubt that advertisers’ budgets change as a result (other than shifting money within their search-specific budgets).
Additional data - including our industry models - are available to corporate subscribers and advisory clients.
Source: Madison and Wall