Alphabet Increases Quarterly Ad Revenue To $32.6 Billion

Alphabet reported second-quarter 2019 earnings Thursday with revenue of $38.9 billion, up 19% compared with the year-ago quarter.

"Our ongoing investments in compute capabilities and engineering talent reflect the compelling opportunities we see across the company," stated Ruth Porat, CFO of Alphabet and Google.

Revenue from Google advertising came in at $32.6 billion for the quarter, up from $28 billion a year ago. Other revenue came in at $6.1 billion, up from $4.4 billion a year ago. Other bets came in at $162 million -- up from $145 million, respectively.

Paid clicks on Google properties dropped to 6%, down from 28%. The cost per click fell 1% compared with 11% in the year-ago quarter. Impressions on Google network member properties came in flat compared with 11% in the year-ago quarter. Cost per impression on Google network member sites rose to 5%, compared with minus 1%, respectively.

Google’s operating income rose to $10.2 billion, up from nearly $9 billion a year ago. The division did take an operating loss of $989 million, up from $732 million.

"Even though we’re seeing advertising revenue rise this quarter, we’ve seen that even Alphabet isn’t immune to internet advertising growth slowing," wrote Gil Elbaz, CEO at Factual, in an email. "It’s becoming clearer that Alphabet will need to continue to differentiate itself as newer players grow more of the digital advertising market share, and increased scrutiny from regulators have the potential to impede Alphabet’s reign.”

eMarketer Senior Forecasting Director Monica Peart agrees. 

“With a showing quite similar to Q1, Google’s second quarter earnings again display the moderating growth that has come to characterize 2019 for the company,” Peart said.

Google will generate $103.73 billion in net digital ad revenue in 2019, taking a 31.1% share of the worldwide digital ad market, followed by Facebook at 20.2% of share, according to eMarketer.

This year, per eMarketer, Google will remain the dominant player in worldwide search ad spending. The company will take 61.1% of the $141.21 billion search market worldwide.

When it comes to display advertising, Google will own 10.1% of the $172.08 billion global display market in 2019, putting it at No. 3 in the world behind Facebook and Alibaba.

This year in mobile also belongs to Google. It will take 35.4% of the $231.12 billion worldwide mobile ad market.  Facebook, at No. 2, with a 27.1% share. 

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