Tech giant Apple released its iOS 14.5 back in April to the extreme consternation of Facebook and Google. The bone of contention is the app tracking feature which promises to protect user privacy.

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The new app tracking feature requests users for their permission before allowing any app to collect their IDFA tag. The Identifier For Advertisers (IDFA) tag is a unique device identifier that is used in conjunction with cookies and tracking pixels to create a virtual database of each user. This database is then used to create ads specifically for each user and to determine each ad’s effectiveness.

The move was met with vehement criticism from advertising majors like Google and Facebook, who stated that Apple’s move could significantly risk their revenues. But while the earlier estimates of 80 percent of all users refusing tracking requests have fallen short by a factor of 5, internet behemoths have felt the effects of Apple’s changes.

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Snap, in particular, was the hardest hit as it dropped over 30 percent in value in the past five days after a disappointing earnings report. The company stated that it had faced challenges in adapting to changes in Apple’s iOS policies regarding activity tracking, which resulted in lower than expected revenues.

Facebook also saw a less-than-expected revenue but not to the same extent. Facebook reported $29.01 billion in revenue, a YOY increase of 35 percent, but it still fell short of the $29.56 billion expected by FactSet polled analysts. While growth remained strong, it was below the previous two quarters’ 52 percent increase. Facebook blamed Apple’s changes in privacy and tracking and the increased regulatory pressure against its advertising models in various countries.

Also read: Data Privacy Day: Know how Apple is helping people protect their privacy

Twitter saw some modest effects but Google remained mostly insulated. Google’s earning’s report remained mostly unaffected as a result of a larger share of its advertising revenue coming through its Android OS ecosystem that stands in competition to Apple’s iOS. Though YouTube was the most affected among Alphabet’s ecosystem, the rest of the business posted better than expected results.

“Compared to some of the other digital advertising companies, Google search is less affected by the Apple IDFA changes,” said Chris Rossbach, Chief Information Officer of J. Stern & Co in London told MarketWatch.

“In addition, many Google users are on computers or on Google’s own Android operating system. These results have highlighted the resilience of Google’s search,” he added.

Also read: Facebook vs Google vs Apple: The big battle around privacy explained

Revenues grew by 41 percent to $65.1 billion calculated before costs are adjusted, beating analyst expectations. Operating margins also grew by 32 percent over the previous quarter. In total, Google services revenues grew to $59.9 billion, an increase of 41 percent. Google Search, which is the company’s biggest revenue stream, increased to $37.9 billion growing by 44 percent. YouTube ad sales grew to $7.2 billion in revenue, slightly lower than the expected revenue of $7.4 billion.

“So overall, as we’ve said, we’re pleased with the strength across our business in the third quarter, it was broad-based, it was global,” said Alphabet Chief Financial Officer Ruth Porat. “In terms of the iOS 14 changes specifically, they had a modest impact on YouTube revenues.”

(Edited by : Shoma Bhattacharjee)