Weeks of financial results in the tech industry, results that also help to understand much better what is happening with the advertising market and with the network in general. The last one whose turn has been Google and, although the company has presented high figures, it has not met expectations and, above all, has given an amount that invites analysis in terms of advertising it means.Alphabet, the parent company of Google and the corporate name for some years now, has closed the last quarter with what has been, as they recall in Reuters , the lowest growth in revenue in the last three years.Google has taken a toll on the fact that its smartphone business has not quite taken off, the changes made to YouTube and also (and this is the most interesting point for the advertising industry) the growing competition in the advertising universe.
This is what analysts at least conclude, because Alphabet CFO Ruth Porat pointed out at the Bahrain WhatsApp Number List investor conference that the slowdown in growth was due to currency fluctuations, competition and unspecified changes in products.However, as they point out in the Reuters analysis , things can be seen more clearly: on the one hand there would be the increasing pressure of advertisers on YouTube (they want to have more control over how and where their advertising appears) and on the other the fact that Google, they remember, has not yet found the best advertising formats and those that work best on mobile devices and emerging markets, either by geography or by medium (such as smart speakers). And this is a problem for the company because 85% of its revenue comes directly from advertisements.To all this, analysts add another question. The advertising business will have to bear certain higher costs in the future as the authorities of the different countries implement regulations that require much more control of consumer privacy.
Google’s financial dataAll of that makes Google’s data worse, at least to analysts, than it might appear at first glance. Alphabet has grown 17% in revenue in the quarter (the previous quarters had not dropped from 20% and in the same period of the previous year it did it to 28%) and by 15% in revenue from ads (24% in the same quarter of the previous year).This meant that although the benefits were above expectations (6,608 million dollars, net, after discounting the EU fine), investors view the company and its data critically. Revenue, after all, was $ 36.34 billion, $ 1 billion below what analysts expected.
Drop in prices and clicks Google’s advertising revenue is complicated. Monetized clicks grew 39%, true, but the amount is much lower than the 66% growth it achieved in the last quarter of the previous year. Much more bleeding is another data: the price per click has fallen by 25% year-on-year.Even so, it is difficult to know exactly where the problem in advertising is in Alphabet / Google and to be able to pinpoint exactly the culprits. As they recall in Market Watch , Alphabet gives results in a somewhat opaque way, always jointly and in the face of which it is impossible to dis aggregate the data. Still today, for example, it is impossible to separate YouTube from overall advertising revenue.