On Friday, May 8, 2026, The New York Times published a guest essay by investigative journalist Julia Angwin with a headline that demands attention: “Meta Is Dying.” She highlights that Meta lost daily active users in Q1 2026, falling from 3.58 billion in Q4 2025 to 3.56 billion.
Angwin sees this as the beginning of a long, slow decline, comparing the company’s trajectory to AOL in 2003 and Yahoo in 2015: technically alive, still profitable, but entering what she bluntly calls the “zombie era.”
She may be right. And if she is, Theodore Levitt told us exactly why this would happen, 66 years ago.
The Lesson Meta Never Learned
In 1960, Harvard Business School professor Theodore Levitt published “Marketing Myopia” in the Harvard Business Review. His central argument was that companies fail not because demand disappears, but because they define their business too narrowly. Railroads collapsed because they thought they were in the railroad business rather than the transportation business. Trolley car companies were replaced by automobiles they could have pioneered. “People don’t want a quarter-inch drill,” Levitt wrote. “They want a quarter-inch hole.”
Now look at Meta’s six major pivots over 22 years and ask: What business did Mark Zuckerberg actually think he was in?
In 2021, he declared the answer was “the metaverse business” – a bet whose Reality Labs division has since accumulated roughly $80 billion in operating losses. Users didn’t agree. In 2023, he pivoted to generative AI and has since committed over $100 billion to building models that, as Angwin notes, currently perform worse than the competition. Q1 2026 results show record revenue of $56.3 billion, up 33% year over year, but also $33.44 billion in total costs, a 35% increase, and an AI spending outlook that has rattled investors.
The revenue looks strong. The trajectory looks like a company that keeps pivoting to new product definitions while its core users quietly disengage.
What The Traffic Data Actually Shows
This is where opinion meets evidence, and the Similarweb traffic for March 2026 is instructive.
Google leads the world with 86.9 billion monthly visits. YouTube follows with 29.3 billion. Facebook comes in third at 11.9 billion, and Instagram comes in fourth at 7.1 billion. That gap between Google and Facebook, is the data equivalent of what Levitt was describing. Google defined itself as being in the information access business. Facebook defined itself as being in the social network business. One of those definitions scales indefinitely. The other runs out of room.
The AI category data is even more pointed. ChatGPT records 5.7 billion monthly visits globally, with year-over-year growth of 28.5%. Gemini is growing sharply at 283.8% YoY. Claude.ai jumped 423.7% to 613.7 million visits YoY.
Meta.ai does not appear in the top 100 most-visited websites.
Meta spent $100 billion entering the AI race. It is not winning it.
The Squeeze Play Angwin Describes
When an aging platform’s user base starts to shrink, the immediate response is almost always the same: monetize harder. Angwin documents this clearly. Meta’s Q1 ad impressions increased 19% year over year while average ad prices rose 12%. Revenue per user jumped 27%. The company is cramming more ads onto its platforms and charging advertisers more for each one.
This is the move that maximizes short-term revenue while accelerating long-term decline. More ads mean a worse user experience. A worse experience means slower growth. Slower growth means the ad inventory eventually stops expanding. Levitt described this as the trap companies fall into when they focus on selling their current product harder rather than understanding what customers actually need.
For digital marketers and SEO professionals, this creates a near-term concern. Meta’s Advantage+ advertising suite delivers genuinely strong performance data – a $4.52 return per dollar spent, 22% higher than comparable manual campaigns, according to Meta’s own earnings reports. But those returns depend on a healthy, engaged user base generating meaningful behavioral signals. If the user base contracts and ad load increases simultaneously, signal quality degrades, and performance follows.
The Counterargument Worth Taking Seriously
Angwin’s essay is persuasive, but she is writing opinion, not analysis, and the full Q1 picture is more complicated than “dying” suggests. Year-over-year, Meta’s daily active user base still grew 4%. The quarter-over-quarter decline has a partially verifiable explanation in internet disruptions in Iran and Russia’s WhatsApp ban. Revenue growth of 33% is not the profile of a company in terminal decline.
What it is, is the profile of a company spending at a scale that requires the growth to continue, while its AI investments have not yet produced meaningful new revenue streams. As the Wall Street Journal‘s Asa Fitch observed this week, “the spending growth looks increasingly unsustainable.”
Levitt’s lesson wasn’t that myopic companies always die quickly. AOL and Yahoo lingered for years. The lesson was that once a company loses the plot on what business it’s actually in, recovery becomes structurally difficult. Every dollar spent defending the wrong definition is a dollar not spent understanding the customer.
The question Levitt would ask isn’t whether Meta is dying. It’s whether Meta has ever clearly understood what business it was actually in. Across six pivots in 22 years, the answer appears to be: not consistently.
That uncertainty is now visible in the traffic data. And traffic data doesn’t lie.
More Resources:
- The Top 6 Search Engines Market Share & The AI Search Engines To Watch
- Google Gemini Gains Share As ChatGPT Declines In Similarweb Data
- Breaking Into The Black Box: Unlocking Meta’s Product-Level Ad Data
Featured Image: Roman Samborskyi/Shutterstock
