Alphabet Q1 Profits Slip, But Revenue Rises To $68B

Alphabet on Tuesday reported that first-quarter revenue rose to $68 billion -- up from $55 billion a year ago.

Google Search and other revenue contributed $39.6 billion -- up from $31.8 billion in the year-ago quarter.

YouTube ads also saw steady growth to nearly $6.9 billion, up from $6 billion. And Google’s network brought in nearly $8.2 billion -- up from $6.8 billion.

Cloud services jumped to $5.8 billion -- up from just above $4 billion -- and Other bets rose to $440 million, up from $198 million.

In terms of operating income, Google Cloud came in at a loss of $931 million, down from $974 million. Other bets remain about even, losing $1,155 million for the quarter, on par with $1,145 in the year-ago quarter.

“Q1 saw strong growth in Search and Cloud, in particular, which are both helping people and businesses as the digital transformation continues,” stated Sundar Pichai, CEO of Alphabet and Google. “We’ll keep investing in great products and services, and creating opportunities for partners and local communities around the world.”

Alphabet may not have met Wall Street analysts’ expectations, but Paul Verna, principal analyst at Insider Intelligence, believes Google is “well positioned to weather privacy changes that have negatively affected its main competitor, Meta, in the wake of Apple’s phaseout of ad identifiers in 2021."

"In 2021, Google outperformed our forecasts across search and video, two of the pillars of digital advertising,” he wrote in a report. “This year, we expect the company to capitalize on a retail rebound and an easing of supply chain constraints, both of which drive the search market of which Google commands a 59% share worldwide."

Google is on track, per Insider, to generate $174.81 billion in net digital ad revenue in 2022 -- up 17.3%.  That gives it a 29% share of the worldwide digital ad market. Facebook is second with a 21.4% share. 

Google's worldwide display business will reach $32.51 billion, giving it a 9.6% share of global display spending.

This year, Google also will capture 27.2% of the worldwide mobile ad market -- with $123.15 billion in net revenue, according to Insider.

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