Google advertising revenue rebounded strongly, YouTube brought in 5 billion USD, the fastest growing company

Alphabet, the parent company of Google, has seen strong growth return in the wake of the previous quarter’s decline. This was fueled by a rebound in online advertising revenue with the US economy. Company shares rebounded 7% after the release of the company’s quarterly earnings report.

More notable than this, investor optimism plays out despite the fact that search giant Google is being sued by the US Justice Department for antitrust practices.

The third quarterly report of the parent company Google showed that the revenue reached 46.2 billion USD. Not only strongly increased compared to 38.3 billion USD in the previous quarter, but also 15% higher than 40.5 billion USD in the same period last year. The Google report also revealed that the cost of booking a search bar increased 9% to $ 8.2 billion – the amount Google pays Apple to be the default search engine on iPhones and other devices.

Although this growth rate was slower than the same period last year, compared with the 8% decline in the previous quarter, this is still a staggering growth rate and beat all analysts’ expectations. Besides soaring sales, Alphabet’s net profit this quarter also reached $ 11.2 billion, a significant improvement from last year’s figure of $ 7 billion.

YouTube, Google’s fastest growing advertising business, brought in $ 5 billion in revenue, up 32% from the same period last year. The company said that YouTube currently has more than 30 million paid subscribers and 5 million free trial subscribers. YouTube TV also has more than 3 million subscribers.

Although the growth momentum is not as high as last year, it is still a significant recovery step compared to the decline of the previous quarter

About 90% of Google’s revenue comes from advertising, a lot of them related to search results. This business segment slowed down earlier this year, when the Covid-19 pandemic destroyed its biggest customers: travel and travel agencies.

But as the blockade measures began to loosen and people gradually adjusted their spending over time, e-commerce boomed and people started to spend more time on YouTube, helping the business. This giant’s advertisement flourished again. The US economy also started to show signs of recovery, recording a record growth in the third quarter of this year. Not only Google, the recovery of the advertising industry also helped strengthen the revenue of companies like Facebook, Snap, Pinterest.

CEO Sundar Pichai said: ” This year’s results, including this quarter, show how valuable the Search product created by Google is to everyone .” He confirmed the Justice Department’s lawsuit over Google’s monopoly behavior in the search market, but he ” believes that our products are generating significant benefits for consumers and are confident they will pass. get this lawsuit . ”

Google’s positive results don’t just come from advertising. The company’s cloud business also brought in $ 3.4 billion this quarter, up 45% year-on-year – growth is still higher than analysts at Canaccord Genuity estimates. Millions of people have to work from home as the Covid-19 epidemic has spurred the “digital transformation” of the workplace, a trend that has increased demand for Google products.

Google’s other businesses, including hardware, cloud services and Play Store, generated $ 5.4 billion in revenue, up 35% from $ 4 billion last year. The company’s other “bets” – including Waymo and Verily – brought in $ 178 million in revenue but still lost more than $ 1.1 billion.

Consult Bloomberg