Meta’s 10% annual revenue comes from scam ads: Report

Meta is reported to have estimated that roughly 10% of its annual revenue — about $16 billion — is generated from scam ads and promotions for prohibited products, according to media reports.

The news piece, originally published in Reuters (which claims to have access to an internal Meta report), mentions that Meta earns about $7 billion in annualized revenue from this category of scam ads each year.

“On average, one December 2024 document notes, the company shows its platforms’ users an estimated 15 billion ‘higher risk’ scam advertisements – those that show clear signs of being fraudulent – every day,” wrote the Reuters report.

“The documents further note that users who click on scam ads are likely to see more of them because of Meta’s ad-personalization system, which tries to deliver ads based on a user’s interests,” the report mentioned.

According to the documents, a large portion of the fraudulent activity came from marketers whose behavior was suspicious enough to trigger Meta’s internal alerts. However, the company only bans advertisers when its automated systems determine with at least 95% certainty that they are engaging in fraud. If the likelihood is lower but still suggests possible scamming, Meta instead imposes higher ad rates as a deterrent, aiming to discourage such advertisers from running campaigns.

On the matter, the Reuters report quotes Meta spokesman Andy Stone as saying that the documents mentioned in the report “present a selective view that distorts Meta’s approach to fraud and scams.” The company’s internal estimate that it would earn 10.1% of its 2024 revenue from scams and other prohibited ads was “rough and overly-inclusive,” Stone reportedly said. The company had later determined that the true number was lower, because the estimate included “many” legitimate ads as well, he said.