Snap, the parent company of social media platform Snapchat has warned its investors that Apple’s upcoming changes to Identifier for Advertisers (IDFA) upon the release of the latest version of iOS 14 may disrupt advertiser demand.
Apple’s upcoming iOS update automatically sets the user’s privacy in a way that developers must request access to in order to provide targeted ads. Without the user opting in, developers and their apps will be more restricted, which will have a snowballing effect on the advertisers each developer works with.
In its most recent earnings call, in which Snap reports user and revenue growth. Snapchat reportedly saw a 55 percent growth in daily active users. The revenue generated from ad sales totalled $911 million, up 62 percent. During the call, the company warned its investors on the possible ramifications the iOS update may have, according to Reuters.
The company acknowledged that any iOS update is “usually disruptive” in some way as the changes each update brings could have unforeseen ramifications in one way or another. However, Snap believes this particular update may pose “risks” to advertiser demand. Though, Snap does acknowledge that the long-term effects on business are currently unseen.
Facebook has been vocal in its opposition to Apple’s changes. The company took out full-page ads, pushing back against Apple’s new privacy measures. Although Snap sees the risks involved in the changes, Snap Chief Business Officer Jeremi Gorman doesn’t necessarily align its views with Facebook. During the earnings call, Gorman reportedly said: “We admire Apple and believe they are trying to do the right thing for customers.”
The developer beta for iOS 14.5 is available now. The public release of iOS 14.5 should come sometime in February.