Google parent Alphabet CEO, Sundar Pichai has made known the company’s revenue figures, indicating growth in all of the company’s key segments.
In 2019, Google made a total revenue of $162 billion, an 18% year-on-year (YOY) growth compared to the $137 billion made in 2018. This increased the company’s revenue from $31 billion in 2018 to $34 billion in 2019.
This shows Google is still growing very fast for an already massive company. But despite the obvious growth, the revenue made by Google’s advertising business, YouTube and Google hardware, broadly disappointed analysts who simply expected more.
This disappointment is said to most likely be what sent the company’s shares 5% below it normal price.
For Google ads business, while it’s still hugely profitable, it however failed to reach $38.4 billion projected by analysts. It actually made $37.6 billion which, though represents a 17% gain in sales YoY, is still slower than the 20% YoY growth from Q4 in 2018.
YouTube Numbers Finally Revealed
For the first time, Google revealed revenue numbers for YouTube. Prior to now, the company has always bundled the revenue of its video arm, YouTube under the Google Other revenue, where its hardware and cloud revenues were listed.
This has made it quite difficult for analysts to find out the real value of the platform, with many merely speculating over the value. Last year, The New York Times estimated that YouTube generated between $16 billion to $25 billion in annual revenue.
But according to Google reports, YouTube ads generated sales of $15.1 billion in 2019 – excluding paid subscriptions. Although this represents a 36% increase from the 2018 figure, it is still below even the minimum estimate of value.
Google has always said YouTube is a major source of growth. And while analysts might be disappointed at the reported value, it still doesn’t take away the truth in that fact.
Get the best of Africa’s daily tech to your inbox – first thing every morning.
Join the community now!