Google’s parent company has released figures and it’s clear that Google Ads continues to slow whilst YouTube continues to grow.
YouTube ads sales grew by 31% in Q4 of 2019 compared to year on year figures, growing to £3.62bn. This was part of Google’s parent company’s increased revenues – which increased 17% year on year to £35.59bn. Whilst that sounds impressive, that’s the slowest Google has grown for over two years.
The jewel in Alphabet’s crown is YouTube, which continues to grow rapidly. Unfortunately, their cloud business lags behind that of its rivals.
Alphabet took in around £2.01bn from its cloud hosting division, which is big, but not as big as Amazon’s £8bn. Saying that their cloud is a fast-growing division of Alphabet’s revenue, seeing more than 50% growth year on year.
Nicholas Hyett, equity analyst at stockbroker Hargreaves Lansdown commented on Alphabet’s slower than hoped for growth: “It’s always important to put these sorts of misses into perspective,” he said. “The core businesses, like Search and YouTube, continue to generate prodigious quantities of cash.”
Google’s advertising revenue increased by 17% to almost £21.05bn. So, we’re not talking about the end of Google advertising by any stretch.
YouTube now accounts for around 10% of Alphabet’s overall revenues in 2019 – at more than $15bn – but a lot of the revenues go to those creators on YouTube who post videos on the video sharing platform.
Simon Dalley from GrowTraffic commented on this: “Alphabet continues to put more effort into YouTube and bloud solutions, recognising the impact of mobiles and super-fast connections on search advertising revenues and the changing uses of the internet. It’s something we see at GrowTraffic as well, whilst there is still a great deal of traffic to be had from Google, everyone has to be creating content in various different ways, including videos, and promoting it in various different ways.”