Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News

      Letter: South Africa risks missing AI wave while world surges ahead

      23 June 2025

      Prosus profit surges 47% as e-commerce bet pays off

      23 June 2025

      Apple shifts its AI strategy

      23 June 2025

      Takealot rides subscription wave to revenue surge

      23 June 2025

      World Bank set to back South Africa’s big energy grid roll-out

      20 June 2025
    • World

      Watch | Starship rocket explodes in setback to Musk’s Mars mission

      19 June 2025

      Trump Mobile dials into politics, profit and patriarchy

      17 June 2025

      Samsung plots health data hub to link users and doctors in real time

      17 June 2025

      Beijing’s chip champions blacklisted by Taiwan

      16 June 2025

      China is behind in AI chips – but for how much longer?

      13 June 2025
    • In-depth

      Meta bets $72-billion on AI – and investors love it

      17 June 2025

      MultiChoice may unbundle SuperSport from DStv

      12 June 2025

      Grok promised bias-free chat. Then came the edits

      2 June 2025

      Digital fortress: We go inside JB5, Teraco’s giant new AI-ready data centre

      30 May 2025

      Sam Altman and Jony Ive’s big bet to out-Apple Apple

      22 May 2025
    • TCS

      TCS+ | AfriGIS’s Helen Hulett on how tech can help resolve South Africa’s water crisis

      18 June 2025

      TechCentral Nexus S0E2: South Africa’s digital battlefield

      16 June 2025

      TechCentral Nexus S0E1: Starlink, BEE and a new leader at Vodacom

      8 June 2025

      TCS+ | The future of mobile money, with MTN’s Kagiso Mothibi

      6 June 2025

      TCS+ | AI is more than hype: Workday execs unpack real human impact

      4 June 2025
    • Opinion

      South Africa pioneered drone laws a decade ago – now it must catch up

      17 June 2025

      AI and the future of ICT distribution

      16 June 2025

      Singapore soared – why can’t we? Lessons South Africa refuses to learn

      13 June 2025

      Beyond the box: why IT distribution depends on real partnerships

      2 June 2025

      South Africa’s next crisis? Being offline in an AI-driven world

      2 June 2025
    • Company Hubs
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • AvertITD
      • Braintree
      • CallMiner
      • CambriLearn
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • Incredible Business
      • iONLINE
      • Iris Network Systems
      • LSD Open
      • NEC XON
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Tenable
      • Vertiv
      • Videri Digital
      • Wipro
      • Workday
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and Media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Fintech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Lifestyle
      • Motoring
      • Public sector
      • Retail and e-commerce
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
    • Events
    • Advertise
    TechCentralTechCentral
    Home » Investment » Alphabet shares tumble as Google underwhelms

    Alphabet shares tumble as Google underwhelms

    By Agency Staff4 February 2020
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    News Alerts
    WhatsApp

    Alphabet reported quarterly revenue that missed analysts’ estimates on waning search advertising growth, while new sales numbers on YouTube also disappointed Wall Street. The stock fell more than 4% in extended trading.

    Overall revenue, excluding payments to partners, was US$37.6-billion in the fourth quarter, less than analysts’ projections of $38.4-billion, according to data compiled by Bloomberg. Advertising revenue in the quarter rose 17%, slower than the 20% year-over-year growth from in the same quarter a year earlier.

    YouTube ads generated sales of $15.1-billion in 2019, up 36% from the previous year, the company said in a statement. That excludes paid subscriptions, but it’s still well below what many analysts estimated. Google has consistently said YouTube is a major source of growth, but hadn’t broken out details until Monday.

    Google’s search ad business isn’t expanding as quickly because of the proliferation of other ways to reach huge audiences online

    Google’s search ad business, while still hugely profitable, isn’t expanding as quickly because of the proliferation of other ways to reach huge audiences online, including social media, e-commerce and video. The company’s search unit posted a 17% gain in sales in the key holiday quarter, but that was outpaced by 25% growth in Facebook’s ad business. Amazon.com’s Other division, which is mostly advertising, saw sales surge 41%. That business is much smaller than Google’s, but it has grabbed more lucrative shopping-related searches in recent years.

    In online video, YouTube is an important asset for Google. But that division spent much of 2019 responding to criticism that it doesn’t do enough to limit the spread of toxic videos and misinformation. YouTube was also forced to end targeted ads on clips that are made for kids, a large and growing audience.

    Room for improvement

    During a conference call following the results, Ross Sandler, an analyst at Barclays, asked why YouTube growth decelerated in the fourth quarter. Justin Post, an analyst at Bank of America Merrill Lynch, estimated that YouTube generates $7 to $8 in revenue per user and asked if there was room for improvement.

    YouTube also shares a lot of ad revenue with partners, including video creators and larger media companies. That shows up in Traffic Acquisition Costs, or TAC, which grew 14% to $8.5-billion in the fourth quarter, from the same period a year ago.

    Alphabet also reported cloud results for the first time. Sales, including a service that rents computing power and G Suite Internet-based productivity software, totalled $2.6-billion, up 53% from a year earlier. Google is pouring money into this business to try to catch up with Amazon and Microsoft. Under cloud boss Thomas Kurian, the Internet giant is also making acquisitions, buying four companies in the booming sector last year.

    Until now, cloud and YouTube had been bundled together in an opaque Google metric known as Other Revenue.

    While it increased disclosure on YouTube and cloud, the company also stopped sharing information on how many times people click on Google ads and how much Google charged for each of those clicks. Those statistics used to be closely followed, but had become less important in recent years.  — Reported by Gerrit De Vynck and Mark Bergen, (c) 2020 Bloomberg LP



    Alphabet Google top YouTube
    Subscribe to TechCentral Subscribe to TechCentral
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleBlackBerry phones set to disappear once and for all
    Next Article Huawei, ZTE fight to stay off US blacklist

    Related Posts

    Apple shifts its AI strategy

    23 June 2025

    Stolen phone? Samsung now buys you an hour to lock it down

    18 June 2025

    Major rift opens between Microsoft and OpenAI

    17 June 2025
    Company News

    IoT connectivity management in South Africa – expert insights

    23 June 2025

    Let’s reimagine Joburg using the power of tech, data and AI

    23 June 2025

    Netstar doubles down on global markets while backing SA growth

    23 June 2025
    Opinion

    South Africa pioneered drone laws a decade ago – now it must catch up

    17 June 2025

    AI and the future of ICT distribution

    16 June 2025

    Singapore soared – why can’t we? Lessons South Africa refuses to learn

    13 June 2025

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    © 2009 - 2025 NewsCentral Media

    Type above and press Enter to search. Press Esc to cancel.