Gen Z girl looking at smartphone screen feeling upset scrolling on social media.

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Governments around the world are making efforts to crack down on teen social media use amid mounting evidence of potential harms, but critics argue blanket bans are an ineffective quick fix.

Australia became the first country to enforce a sweeping social media ban for under-16s in December, requiring platforms like Meta’s Instagram, ByteDance’s TikTok, Alphabet’s YouTube, Elon Musk’s X, and Reddit to implement age verification measures or face penalties.

Several European countries are now looking to follow Australia’s lead, with the U.K., Spain, France, and Austria drafting their own proposals. Although a national ban in the U.S. looks unlikely, state-level legislation is underway.

It comes after Meta, the parent company of Facebook, Instagram and Threads, faced two separate defeats in trials related to child safety and social media harms in March.

A Santa Fe jury found Meta misled users about child safety on its apps. The next day, a Los Angeles jury ruled that Meta and YouTube designed platform features that contributed to a plaintiff’s mental health harms.

Meta’s stock drops almost 8% as 2 court defeats add to Zuckerberg’s recent woes

These developments are set to “unleash a lot more legislation,” Sonia Livingstone, social psychology professor and director of the London School of Economics’ Digital Futures for Children center, told CNBC.

However, Livingstone said a social media ban for teens is a slapdash solution from governments that have failed to properly police tech giants for years.

“I think the argument for a ban is an admission of failure that we cannot regulate companies, so we can only restrict children,” she said, explaining that the U.S. and Europe already have a lot of legislation in the books that isn’t being enforced.

“When are governments really going to enforce, raise the stakes on fines, ban the companies if necessary for not complying,” she added.

Enforce existing laws

Experts argue the sector has for too long escaped accountability and the rigid requirements faced by other industries.

“[Governments] should be implementing the law [and] big tech companies should be facing a slew of regulatory interventions that forbid a whole series of practices that they currently do,” Livingstone said.

She highlighted the U.K.’s Online Safety Act, which “requires safety by design” — this means features such as Snapchat’s “Quick Add” that invite teens to befriend others should be stopped, according to Livingstone.

Livingstone believes that a blanket ban wouldn’t even be under discussion if social media companies had undergone appropriate premarket testing to establish if their features are safe for their target audience.

“There are lots of areas where we have a well functioning market that requires testing to establish it meets the standards…[before products] can go into the market,” she said. “If we did that for AI and for social media, we would be in a whole different place and we’d not be having to talk about banning children from anything.”

Josh Golin, executive director at Boston-based non-profit Fairplay, told CNBC that he’d like to see “privacy and safety by design legislation rather than blanket bans” across the U.S.

This includes passing the Children and Teen Online Privacy Protection Act to put a stop to personal data-driven advertising towards children, so there’s “less financial incentive for social media companies to target and addict kids.”

Golin added that passing the Senate’s version of the Kids Online Safety Act (KOSA) is also key to ensuring platforms are held legally responsible for design features that can cause addiction or other harms.

He added that Meta has already successfully lobbied to stop KOSA even though it passed the Senate in 2024. But, if it continues to block legislation further, Golin thinks this could see further pressure “line up behind bans because addictive and unsafe is not OK.”

A ban is ‘lazy’ and ‘unfair’

A sweeping social media ban only punishes a generation of young people who have become increasingly dependent on online means of interaction, according to Livingstone. She said bans are a “lazy” solution from governments and an “unfair” outcome for young people.

“It’s the 15 years in which we don’t let our children go outside and meet their friends. It’s the 15 years in which we stopped funding parks and youth clubs for them to meet in,” she said.

“So a ban now is to say to ‘Children, we can’t make the regulation work. We can’t update it fast enough. We haven’t built you anything else to do, but that’s just tough. We’ve terrified your parents into feeling that there’s nothing they can do, and we’re going to take you away from the service where you hoped you would feel some sociability and entertainment.”

A ‘quiet revolution’: Why young people are swapping social media for lunch dates, vinyl records and brick phones

Dr. Victoria Nash, associate professor and senior policy fellow at the Oxford Internet Institute, described social media bans as an “extreme” measure that alienates young people from the benefits these platforms provide.

“We know children and young people get their news online and through apps, so you cut that off,” she said. “My view would be that I don’t think this justifies a ban. To me, what this justifies is more responsible behavior by social platforms to cut down on their most harmful features.”

She said that bans could drive young people and children to less regulated corners of the internet, which don’t have the same protections.

Many Australian teens flouted the social media ban when it first came into force in December. A BBC report found that downloads of VPNs, which hide users’ locations to avoid country-specific restrictions, increased before the ban.

Additionally, downloads of some apps that weren’t yet affected such as Lemon8, Yope and Discord also surged in the days after the law came into effect, per the report.

“I think it [a ban] certainly gets rid of all the harmful aspects, but it gets rid of the good ones too and I’m just not yet sure if that’s proportionate,” Nash added.

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INGLEWOOD, CALIFORNIA – NOVEMBER 17: A detail view of a NBC Sunday Night Football video camera during the first half between the Cincinnati Bengals and the Los Angeles Chargers at SoFi Stadium on November 17, 2024 in Inglewood, California.

Ric Tapia | Getty Images Sport | Getty Images

YouTube TV subscribers may soon be without “Sunday Night Football,” “The Voice” and other NBCUniversal programming as the parties ramp up for a carriage dispute that could lead to a blackout at the end of the month.

CNBC reported the two sides could be headed for a potential blackout earlier Thursday. It’s a sign of YouTube’s relatively newfound muscle in streaming and television.

YouTube TV has about 10 million subscribers, according to people familiar the matter.

NBCUniversal said in a statement that YouTube TV “has refused the best rates and terms in the market, demanding preferential treatment and seeking an unfair advantage over competitors to dominate the video marketplace — all under the false pretends of fighting for the consumer. The result: YouTube TV customers will lose access to NBCUniversal’s premium programming.”

Starting Thursday night, NBCUniversal will begin running messages for YouTube TV customers alerting them to the impending loss of networks if a deal isn’t reached.

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NBCUniversal has never “gone dark” in its history in the U.S., both under the ownership of Comcast and General Electric before that, according to a company spokesperson.

YouTube TV issued its own statement Thursday, saying, “NBCUniversal is asking us to pay more than what they charge consumers for the same content on Peacock, which would mean less flexibility and higher prices for our subscribers. We are committed to working with NBCUniversal to reach a fair deal for both sides ahead of our current agreement expiring on September 30. If their content is unavailable for an extended period of time, we’ll offer our subscribers a $10 credit.”

Disclosure: Comcast is the parent company of NBCUniversal, which owns CNBC. Versant would become the new parent company of CNBC upon Comcast’s planned spinoff of Versant.

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Shoppers cast shadows as they carry their bags along the waterfront in Portland, Maine, U.S, December 26, 2024. 

Kevin Lamarque | Reuters

It’s not just Walmart.

The leaders of companies that serve everyone from penny-pinching grocery shoppers to first-class travelers are seeing cracks in demand, a shift after resilient consumers propped up the U.S. economy for years despite prolonged inflation. On top of high interest rates and persistent inflation, CEOs are now grappling with how to handle new hurdles like on-again, off-again tariffs, mass government layoffs and worsening consumer sentiment.

Across earnings calls and investor presentations in recent weeks, retailers and other consumer-facing businesses warned that first-quarter sales were coming in softer than expected and the rest of the year might be tougher than Wall Street thought. Many of the executives blamed unseasonably cool weather and a “dynamic” macroeconomic environment, but the early days of President Donald Trump’s second term have brought new challenges — perhaps none greater than trying to plan a global business at a time when his administration shifts its trade policies by the hour.

Economists largely expect Trump’s new tariffs on goods from China, Canada and Mexico will raise prices for consumers and dampen spending at a time when inflation remains higher than the Federal Reserve’s target. In February, consumer confidence — which can help to signal how much shoppers are willing to shell out — saw the biggest drop since 2021. A separate consumer sentiment measure for March also came in worse than expected.

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NYSE Arca Airline Index versus the S&P 500.

Another sign of weakness has been in air travel. The sector, especially large international airlines, had been a bright spot following the pandemic, with consumers proving again and again that they wouldn’t give up trips even in the face of the biggest jump inflation in more than four decades. This week, however, the CEOs of the four largest U.S. airlines — United, American, Delta and Southwest — said they are seeing a slowdown in demand this quarter. American, Delta and Southwest cut their first-quarter forecasts.

Plus, the job market, whose strength in recent years has been the country’s economic glue, is showing early signs of stress as job growth slows and unemployment ticks up. 

These trends have thrown cold water on what was a red-hot stock market and sparked new fears about a potential recession, sending the S&P 500 tumbling 10% from its record highs in February, though it had recovered significant ground by Friday afternoon.

Now, as investors and executives grow more worried about the impact tariffs will have on consumer spending and fret about an administration they had high hopes for just a few months ago, even the strongest companies are striking cautious tones as the weaker ones get even louder. 

Take Walmart, the retail industry’s de facto leader, which has spent the last year turning an uncertain economy into fuel for growth as it courted higher-income consumers. When Walmart announced fiscal fourth-quarter earnings last month, its stock fell after it warned that profit growth would be slower than expected in the year ahead. It was a rare warning sign from a company that tends to thrive in a weaker economy, and an indication that it’s expecting consumers to pull back from higher-margin discretionary goods in favor of essentials like milk and paper towels in the year ahead. 

“We don’t want to get out over our skis here. There’s a lot of the year to play out,” Walmart’s finance chief, John David Rainey, told analysts when discussing the company’s outlook. “It’s prudent to have an outlook that is somewhat measured.”

Charly Triballeau | Afp | Getty Images

Ed Bastian, chief executive of Delta Air Lines – the most profitable U.S. carrier that has reaped the rewards of big spenders in recent years – struck a similar tone after it slashed its earnings and revenue forecast for the first quarter. In an interview Monday on CNBC’s “Closing Bell,” Bastian said that consumer confidence has weakened and that both leisure and business customers have pulled back on bookings, which led it to cut its guidance.

“Consumers in a discretionary business do not like uncertainty,” said Bastian. “And while we do believe this will be a period of time that we pass through, it is also something that we need to understand and get to calmer waters.”

To be sure, it wasn’t just fewer people booking trips that led the airline to cut its first-quarter forecast. Questions about air safety compounded the problem after two major airline accidents, including Delta’s own crash landing in Toronto, in which no one died.

Beyond Delta, rival United said it will retire 21 aircraft early, a move that aims to cut costs.

“We have also seen weakness in the demand market,” Kirby said at Tuesday’s JPMorgan airline industry conference. “It started with government. Government is 2% of our business. Government adjacent, all the other consultants and contracts that go along with that are probably another 2% to 3%. That’s running down about 50% right now. So a pretty material impact in the short term.”

The airline has seen some of that dynamic “bleed over” into the domestic leisure market, as well, Kirby added. He said the company is already looking at where it will cut flights, eyeing a big drop in traffic from Canada into the U.S. and in markets that were popular with government workers.

American Airlines cut its first-quarter earnings forecast and said in addition to demand pressures, bookings were hurt after a deadly midair collision of an Army helicopter with one of its regional jets in Washington, D.C., in January.

The company also felt the pullback in government travel and associated trips like those for contractors.

“We know that there’s some follow-on effect in terms of leisure travel associated with that as well,” said CEO Robert Isom.

Airline executives were upbeat about longer-term demand in 2025, however.

Other strong companies, such as Dick’s Sporting Goods, E.l.f. Beauty and Abercrombie & Fitch, also issued weak forecasts in recent weeks, though they indicated they were feeling positive about the second half of the year. 

“I do think it’s just a bit of an uncertain world out there right now,” Ed Stack, chairman of Dick’s Sporting Goods, told CNBC when asked about the company’s guidance. “What’s going to happen from a tariff standpoint? You know, if tariffs are put in place and prices rise the way that they might, what’s going to happen with the consumer?”

Over the last year, companies like United, Walmart and Abercrombie have managed to outperform the S&P 500, even as shoppers reduced discretionary spending, so this change in commentary marks a major shift. It’s a warning sign that shoppers could be starting to crack, and that even excellent execution is no match for tariff-induced price increases after four years of historic inflation. 

Meanwhile, the companies that have already spent the last year calling out uncertain consumer dynamics are sounding even more worried.

“Our customers continue to report that their financial situation has worsened over the last year, as they have been negatively impacted by ongoing inflation. Many of our customers report they only have enough money for basic essentials, with some noting that they have had to sacrifice even on the necessities,” the CEO of Dollar General, Todd Vasos, said on the company’s fourth-quarter earnings call Thursday, adding customers are expecting value and convenience “more than ever.” The worsening consumer outlook has compounded the company’s own internal challenges.

“As we enter 2025,” Vasos continued. “We are not anticipating improvement in the macro environment, particularly for our core customer.”

Elsewhere in the retail industry, American Eagle on Tuesday warned that cold weather led to a slower-than-expected start to the first quarter, but said it wasn’t just temperatures. The apparel retailer specifically called out “less robust demand” and said it’s taking steps to reduce expenses and manage inventory as it braces for what’s still to come. 

“[Consumers] have the fear of the unknown. Not just tariffs, not just inflation, we see the government cutting people off. They don’t know how that’s going to affect them. They see programs being cut, they don’t know how that’s going to affect them,” said CEO Jay Schottenstein. “And when people don’t know what they don’t know – they get very conservative … it makes everyone a little nervous.”

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A Delta Airlines and American Airlines plane are seen at Ronald Reagan Washington National Airport in Arlington, Virginia, on July 1, 2023.

Stefani Reynolds | AFP | Getty Images

Airlines are cutting their first-quarter profit and sales estimates, warning that a weaker economic backdrop is weighing on travel demand.

Ahead of a JPMorgan industry conference, American Airlines on Tuesday said it expects to lose between 60 cents a share and 80 cents a share in the first three months of the year, a wider loss than the 20 cents to 40 cents a share it previously forecast. It said revenue would likely be flat on the year compared with a January estimate of a rise of as much as 5%.

American said in a securities filing that “the revenue environment has been weaker than initially expected due to the impact of Flight 5342 and softness in the domestic leisure segment, primarily in March,” referring to the deadly collision of one of its regional jets and an Army helicopter in Washington, D.C., in January.

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The forecast followed Delta Air Lines slashing its first-quarter estimates after the market closed Monday. Delta said its outlook was “impacted by the recent reduction in consumer and corporate confidence caused by increased macro uncertainty, driving softness in Domestic demand.”

In addition to leisure travel, carriers have said also noted a sharp decline in government travel since the start of the latest Trump administration and its policies like tariffs, government layoffs and other cost cuts.

“I think people are cautious and they’re pulling back a little bit on travel, not in an organized manner but just kind of waiting to see what’s going to transpire, whether it’s trade and tariff challenges or macroeconomic policy changes or just a little bit of the unsettledness of the market that we all see,” CEO Ed Bastian said at the JPMorgan conference.

United Airlines CEO Scott Kirby echoed that sentiment at the same conference.

“We have also seen weakness in the demand market,” Kirby said. Government travel is about 2% of United’s business, but other workers’ travel is also affected, like consultants and contractors, which account for another 2% to 3%.

“We’ve seen some bleed over to that into the domestic leisure market,” Kirby said.

One cost-saving measure: Kirby said United is retiring 21 aircraft early, airplanes that it would otherwise have to spend $100 million on to overhaul engines this year.

Both executives were more upbeat on longer-term trends and bright spots like long-haul international and premium travel demand.

Delta shares ended the day more than 7% lower. United shed 2% and American shares fell more than 8%.

Southwest Airlines also cut its unit revenue guidance, to up no more than 4%, down from a forecast of as much as 7% for the first quarter over last year. The carrier also announced on Tuesday an end to its “two bags fly free” policy to charge customers for checked luggage for the first time, starting in May. Its shares rose more than 8%.

JetBlue Airways shares ended 4% higher.

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