Global social media advertising revenue is projected to reach $640 billion by the end of 2030, according to the inaugural Social Media Advertising Market Landscape 2026 report published by industry analysts at Omdia.

The research indicates that this sector will expand at a compound annual growth rate of 12 per cent over the next five years.

During this timeframe, the share of social media within the total online advertising market is expected to rise from 33 per cent to 44 per cent.

This shift positions social media as one of the most rapidly expanding segments in the industry, alongside retail media.

Sustained performance in this area is being underpinned by rising user engagement and a growing preference among advertisers for full-funnel solutions.

The proliferation of self-serve platforms has also played a critical role in allowing a broader range of businesses to access social ad inventory.

Revenue is increasingly being driven by video formats such as Reels, TikTok, Shorts, and Stories, which accounted for 60 per cent of total social media ad income in 2025.

Platforms are successfully capturing budgets that were historically allocated to online publisher inventory and the digital offerings of traditional broadcasters.

Future growth will likely be fueled by an increase in high-value video ad load and enhanced e-commerce capabilities integrated directly into social apps.

Clearer segmentation between performance-driven and premium formats is also expected to contribute to the upward revenue trend.

A highly concentrated market structure defines the segment, as 90 per cent of global revenue is generated by just six applications.

These dominant platforms include Facebook, Instagram, Douyin, YouTube, TikTok, and WeChat.

Meta effectively controls the market through its ownership of Facebook and Instagram, which together accounted for 54 per cent of all social media ad revenue in 2025.

When the Chinese market is excluded from the data, Meta’s share of the sector rises to almost 70 per cent.

“AI-driven targeting and recommendation algorithms are turbocharging the advantage of these big players,” said Omdia principal analyst Kia Ling Teoh.

“These capabilities favour ‘walled garden’ platforms with deep user data and sophisticated computing infrastructure, locking out smaller players and funnelling ad dollars to the top,” Teoh added.

Maintaining this level of dominance will require platforms to find a balanced approach between aggressive monetisation and the user experience.

Analysts warn that over-saturating feeds with advertisements could alienate users and eventually undermine long-term engagement levels.

The ability to preserve a positive environment for the audience while optimising AI-driven ad delivery will be vital for future success.

Finally, the company explained that sustained expansion depends on the industry’s capacity to evolve without compromising the core reasons why users interact with these digital spaces.