Reddit Falls 29%, DoorDash's Dead Deal Returns: Ad Industry Braces for Q4 M&A Wave

DoorDash CEO Tony Xu confirmed he abandoned a 2021 attempt to buy Instacart because he feared Biden-era regulators would block it — and that deal logic has now flipped, fueling expectations of a blockbuster Q4 M&A spree.

Xu told The Information he backed out of the Instacart bid over regulatory worry. Under the Trump administration, acquisitions that would have drawn tough scrutiny are proceeding unopposed, as AdExchanger discussed on its Big Story Podcast. The Information jokes that CEOs ought to "get your deals in while ya still can, folks."

A second force is pushing sellers toward the table: risk-averse investors unsettled by the AI revolution (the industry-wide shift toward artificial intelligence-based products and workflows). The Information cites Duolingo, Coursera and Zoom as companies that have lost investor support but remain attractive to buyers. They could join Bumble or Roku in limping to an exit.

Why ad tech watchers care about Duolingo and Zoom

Duolingo, Coursera and Zoom share one trait: they have put little effort into earning ad revenue. Zoom briefly tested a pilot ad program to monetize free users in 2021 and shut it down a year later. These companies hold the scaled user bases and first-party data (customer data collected directly rather than via third-party trackers) that marketers covet, but little appetite for the ads business. An acquirer with ad DNA could flip that switch.

The takeaway: a permissive antitrust climate plus discounted, data-rich targets makes Q4 a buyer's market.

Is Meta trying to become TV?

Meta announced last week it is testing long-form content on Instagram, letting creators publish videos up to 90 minutes long. The test arrives as direct-to-consumer brands pour money into CTV (connected TV, streaming delivered over the internet) spending.

Cody Plofker, former CEO and CMO of makeup brand Jones Road, said at Tatari's Forward event in New York on Thursday that he had opposed TV advertising until he realized spending 80% of the company budget on Meta was limiting brand exposure. Mike Shields writes in Next in Media that many DTC brands have "[maxed] out social platforms" and now treat TV advertising "as a performance vehicle." CTV ad platforms like Tatari are copying Meta and Google by launching their own optimization engines.

Meta is now hunting for its own spot in the TV landscape. The caveat: YouTube already commands engaged, loyal followings, and its on-demand delivery fits the TV mold, whereas Instagram's algorithmic feed is not the traditional TV experience. As one creator-market insider told Shields, why take away what works on YouTube TV and redirect resources to Instagram TV?

The takeaway: Meta's 90-minute test targets TV budgets, but the format mismatch is real.

Brand safety hits publishers where it hurts

AI search is the newer threat draining publisher ad revenue, but brand safety (advertiser tools that block placement near risky content) still spooks the sell side. Last week, former writers at the feminist news site Jezebel raised the alarm that hundreds of articles had been removed. They pointed at Jezebel's new owner, Paste Magazine, which acquired the site from G/O Media in 2023.

Anna Merlan, a former Jezebel writer now at Mother Jones, says sources told her Paste publisher William Sagan removed the articles after an "advertising and analytics company" flagged more than 4,000 articles as "not brand safe." Sagan denied brand safety motivated the removals in statements to Mother Jones and The Washington Post, saying Paste flags articles for many reasons, including grammatical errors, and temporarily reverts them to "draft" status. Many of the removed Jezebel pieces were republished after their authors started asking questions.

The motivation remains unclear. But Jezebel has long suffered monetization troubles tied to advertiser concerns over its coverage, and former Paste editor-in-chief Josh Jackson claimed he never knew how deeply brand safety solutions can demonetize publisher content until Paste bought Jezebel.

The takeaway: one vendor flag can strip thousands of articles from a site, whatever the owner's stated reason.

In brief

• Reddit shares fell 29% and Roblox dropped 17% on Friday on user growth concerns after Q3 earnings; Pinterest dipped 3% after missing ad revenue expectations. [Yahoo Finance]
• People Inc. laid off 195 employees, largely in its "print and legacy web businesses," citing "rapid changes in media" in a memo from CEO Neil Vogel. [The Hollywood Reporter]
• A network of 37 fake local news websites boosting mainly Democratic candidates in swing states is having its content picked up by ChatGPT; the sites lack ads and only recently started publishing. [NPR]
• Meta settled another lawsuit over social media addiction among children. [NYT]
• Microsoft will retire Copilot AI assistant features from smart TVs after anti-bloatware backlash. [Advanced TV]
• Digiday examines how AI will reshape ad agency team structures and job descriptions.
• Paramount+ hired former Netflix executive Damla Dogan as head of unscripted. [TheWrap]

If the Q4 deal window opens as widely as the podcast chatter suggests, the first test will be whether a Duolingo- or Zoom-scale target actually changes hands.