Clouds of Success: Google’s Rise in Online Advertising and Cloud Business
While economic worries clouded the figures of the Alphabet holding company in previous quarters, the engine of the advertising business is now picking up again.
Google can continue to rely on its strengths: In the past quarter, there were significant increases in advertising around the Internet search and the video platform Youtube. At the same time, progress was made in the cloud business – and losses in other projects of parent company Alphabet were also lower than usual.
Advertising revenue from the Google search engine grew year-on-year from just under $40.7 billion to around $42.63 billion. Advertising revenues at YouTube increased from 7.3 to 7.66 billion U.S. dollars, as the Internet group announced on Tuesday. In the past quarters, economic worries had partly slowed down online advertising spending. Now Google’s growth is accelerating again.
Fewer losses on “other bets”
The advertising business is also largely driving profits, bringing in operating income of $23.45 billion, up 8.5 percent from a year earlier. The cloud business posted an operating gain of $395 million, up from a red $590 million in the year-ago quarter.
In so-called “other bets,” such as robotaxis and delivery drones, the operating loss fell sharply year over year, to $813 million from $1.34 billion a year ago. Longtime finance chief Ruth Porat will be in charge of investments in those businesses, among others, in a newly created post.
Overall, revenue at parent company Alphabet grew seven percent to $74.6 billion (67.5 billion euros). Profits increased from 16 to just under 18.4 billion US dollars. Alphabet shares rose at times by more than six percent in after-hours trading.
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