In 2019, Instagram's US user growth rate will have dropped to single digits for the first time to 6.7%, down from 10.1% in 2018. Starting in 2020, and through the end of our forecast period in 2023, we estimate that the social media platform will grow slower than previously expected.

Growth will be at 4.5% in 2020, revised down from 5.4%, and in 2021, it will be 3.2% instead of 4.1%. Contributing to Instagram’s overall slower growth is the fact that older age groups are not joining the platform as quickly as anticipated.

While older users will not be growing as fast, there have been larger-than-expected gains in US users ages 25 to 34, at 11.4%. However, we don’t anticipate that this group will change substantially in the coming years, as increased competition from a Snapchat resurgence and the rise of TikTok will make it harder for Instagram to maintain high growth.

“Instagram is doing really well—it is the second-most internet-penetrated social media platform in the US behind Facebook, and despite increased pressure from competition, we expect it to maintain its second-place position with a good gap from the rest of the platforms,” said Nazmul Islam, junior forecasting analyst at eMarketer.

Additionally, Instagram’s ad revenues continue to grow at high double-digit rates. We expect the social media platform to generate $9.45 billion in ad revenues in 2019, and grow 46.6% to $13.86 billion in 2020. Newly introduced ads in different parts of the app, like the “Discover” tab, open up more inventory for advertisers. Shoppable ads are currently in beta on the platform, but we expect that they will play a major role in future growth.