YouTube Q2 Ad Revenue Hits $8.66 Billion, up 13%, Short of Wall Street Expectations

Ad spending on YouTube continued at grow at a double-digit clip in the second quarter of 2024, with the Alphabet-owned video platform generating advertising revenue of $8.66 billion in the period, up 13% year over year.

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However, YouTube’s ad revenue for Q2 fell short of analyst estimates of $8.93 billion for the quarter, per FactSet’s StreetAccount. In Q1, its ad sales had popped 21%, to $8.1 billion . (The advertising figures don’t include subscription revenue from YouTube’s business.) That said, primetime TV ad spending on U.S. networks in the first half of 2024 was down 2.8%, per estimates by media-measurement firm iSpot.tv.

Overall, Alphabet beat analyst expectations. The company reported Q2 revenue of $84.74 billion (up 13.6%) and earnings per share of $1.89. Wall Street consensus estimates were for revenue of $84.19 billion in revenue and EPS of $1.84, according to financial data provider LSEG.

Netflix has identified YouTube as a competitor, insofar as both are leading global streaming services that compete for consumer attention. YouTube also sells subscription services: According to Google, in 2023 YouTube and Google subscription services generated more than $15 billion in revenue , including from YouTube Premium and YouTube Music and YouTube TV. (Alphabet does not regularly break out subscription revenue.) But Netflix execs say the two are complementary. Referring to Netflix’s spending on original content, co-CEO Greg Peters said on the company’s Q2 earnings interview last week, “it’s really hard to imagine how that kind of big creative bet would happen and be possible within YouTube’s model.”

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At YouTube’s annual Brandcast event, held during the TV biz’s upfronts this spring, execs reinforced the platform’s massive scale for the Madison Avenue audience . On average, viewers watch more than 1 billion hours of content on TV screens daily. According to Nielsen’s total TV and streaming report for the U.S., YouTube has had the No. 1 share in streaming watch-time every month on American TVs since February 2023.

In Q2, the Google Cloud business saw revenue jump 29%, to $10.35 billion, with operating income nearly tripling to $1.17 billion. Separately, Google had been in talks to acquire Israeli cloud-based cybersecurity firm Wiz in a $23 billion deal — but Wiz opted to call off the discussions and pursue an IPO instead, as reported by CNBC.

“Our strong performance this quarter highlights ongoing strength in Search and momentum in Cloud,” Alphabet CEO Sundar Pichai said in announcing the Q2 earnings. He added, “We are innovating at every layer of the AI stack. Our longstanding infrastructure leadership and in-house research teams position us well as technology evolves and as we pursue the many opportunities ahead.”

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