Google’s revenue climbs 13% in Q1, but company flags ad revenue slowdown

Revenues for Alphabet, the parent company of Google and YouTube, have climbed to US$41.159bn in the first three months of 2020 – a 13% increase on the same period last year.

Its largest source of revenue was advertising on Google, which brought in US$33.763bn, a 10.4% increase year-on-year. US$4.038bn came from YouTube ads, a 33.5% increase. Revenue from ‘Google Search and other’ was $24.502bn, an 8.7% increase.

The cost of Google’s revenues was US$33.182bn, while the company also spent US$6.820 on research and development. Sales and marketing costs were US$4.5bn, up 15.2%. In the first quarter of last year, Google paid US$1.697 in European Commission fines for abusive practices in online advertising. This quarter, that cost was down to zero.

Google’s financial highlights for Q1 (Click to enlarge)

Similar to the warnings issued by Facebook, Google noted that whilst the overall period was strong, the tail end of the quarter presented worrying signs.

Google revenues for Q1 (Click to enlarge)

“Performance was strong during the first two months of the quarter, but then in March we experienced a significant slowdown in ad revenues,” Google’s chief financial officer Ruth Porat said. “We are sharpening our focus on executing more efficiently, while continuing to invest in our long-term opportunities.”

CEO of Alphabet and Google, Sundar Pichai, added: “Given the depth of the challenges so many are facing, it’s a huge privilege to be able to help at this time. People relying on Google’s services more than ever and we’ve marshalled our resources and product development in this urgent moment.”


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