First-quarter advertising revenue for Google parent Alphabet fell shy of Wall Street expectations.


Google is resilient, but it isn’t bulletproof.

First-quarter results from parent company Alphabet Inc. GOOG -3.04% on Tuesday afternoon showed that the world’s largest online advertising company is hardly immune to the pressures being felt by others in the sector. Total advertising revenue grew 22% year over year to $54.7 billion, but still fell shy of the $55 billion expected by Wall Street. The main culprit was YouTube, where ad revenue of nearly $6.9 billion fell about 8% short of the $7.4 billion analysts were expecting. YouTube’s ad revenue also saw substantial deceleration, growing 14% on year in the most recent quarter compared with 25% growth in the December period and 49% growth in last year’s first quarter.

The results took Alphabet’s share price down 3% after-hours even following a drop of nearly 4% during the market’s selloff in the regular session. The stock is down 18% so far this year through Tuesday’s session, but it has notably outperformed others in the online advertising space due to a belief that the company’s ad business, based mainly on search, was least exposed to the multi-headed challenges of growing inflation, supply chain woes and the war in Ukraine. Shares of Facebook -parent Meta Platforms—Google’s biggest rival in ads—are down 46% so far this year.

Google’s actual results won’t improve confidence in the group. The company noted in its conference call Tuesday that within the YouTube business brand advertising was strong compared with direct-response ads. That contrasts a bit with results last week from Snapchat parent Snap Inc., which reported that its brand advertising business in particular was hit by “supply chain and labor supply headwinds.” But relative to Google’s other ad segments, YouTube is also seen as more vulnerable to the surging popularity of rival video platform TikTok, which has even more significantly affected the outlook for Facebook. Meta’s share price fell another 3% after-hours following Alphabet’s results.

Google is still in excellent shape financially. The company added $70 billion to its buyback plan—after repurchasing more than $50 billion in shares over the last 12 months—despite a “meaningful increase” in capital spending planned for this year. Operating earnings of $20.1 billion for the quarter even came in 2% ahead of Wall Street’s projections despite the advertising revenue miss. But with the forces weighing down the global online ad business unlikely to abate in the second quarter, the biggest player in the business won’t remain unscathed.

Write to Dan Gallagher at

Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Source: WSJ

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like

Angry Homeowner Pulls Gun in Dispute With Workers – Scioto County Daily News

Angry Homeowner Pulls Gun in Dispute With Workers An unhappy homeowner held…

FBI Needs to ‘Explain What They Were Doing’ and Rationale with Twitter and Hunter Story

On Monday’s broadcast of CNN’s “OutFront,” Rep. Ro Khanna (D-CA) stated that…

Glynn County Police Chief Jacques Battiste stepping down

GLYNN COUNTY, Ga. – Jacques Battiste, the police chief in Glynn County,…

Christine McGuinness says 'dreams do come true' as she breaks silence after kissing friend Chelcee Grimes

Christine, who was recently spotted kissing former footballer Chelcee at Winter Wonderland,…

Raphael Warnock Herschel Walker final push for votes

Each candidate is sticking to friendly turf the Monday before voters decide…

Wilson County authorities searching for suspects who stole equipment over weekend

Trio attempted to break into building, stole equipment early Sunday morning Deputies…

Many kids are struggling. Is special education the answer?

The COVID-19 pandemic sent Heidi Whitney’s daughter into a tailspin. Suddenly the…

Jackknifed semi closes lanes on I-75 South in Brandon

TAMPA, Fla. (WFLA)— A jackknifed semi is affecting traffic on Interstate 75…

Residents' anger and sadness as 3 Kirklees leisure centres to shut over crippling running costs

The three centres are to be closed until March next year

Joe Biden Forgets Which Century He’s in During Kennedy Honors Speech

President Joe Biden struggled to deliver a speech from his teleprompter on…

Serial Murderer Richard Cottingham Admits to Killing 5 Women

Richard Cottingham A 76-year-old convicted serial murderer in the tri-state area known…

Andrew Lawson Shot and Killed Austin Walsh: Deputies

 A deputy was arrested for manslaughter this weekend for allegedly shooting…