An ominous sign for the online advertising market

The YouTube logo is seen at YouTube Space LA in Playa Del Rey, Los Angeles, California, US October 21, 2015.

Lucy Nicholson | Reuters

Online advertising market continues to be affected by heavyweights Alphabet and Microsoft reported disappointing sales for their most recent quarters on Wednesday.

YouTube ad revenue fell 2% year-over-year to $7.07 billion in Alphabet’s third quarter, missing analyst estimates of $7.42 billion. This is the first time YouTube’s ad revenue has fallen on a year-ago basis since the company began publishing divisional results in its earnings report in 2019.

Alphabet’s overall revenue grew strongly decline from 41% a year ago to 6% in the latest quarter, underscoring fears of a looming recession that have prompted companies to cut back advertising and marketing campaigns. Indeed, Alphabet’s chief financial officer Ruth Porat said on a call with analysts that YouTube’s revenue decline “primarily reflects a further decline in advertiser spend.”

Alphabet’s chief business officer, Philipp Schindler, said some advertisers have slowed their online ad spend with Alphabet coming from the financial services, insurance, loan and mortgage and electricity industries. death.

Last week, Snap set a tone for the online ad market when it missed analysts’ estimates for the third quarter of $1.13 billion in revenue, sending its stock Acrobatic more than 30% the next day. Snap attributes poor sales to companies reduce their marketing budgets “in response to the poor economy, the company said in a statement Letters for investors.

Microsoft also report its online advertising business slowed on Wednesday.

Its news and search advertising business (which includes Bing and Microsoft News) reported sales growth of 16% in the September quarter (Q1 of fiscal 2023), much lower than the previous year. 40% revenue growth it reported a year ago in the same quarter. Indeed, the growth rate of that business has shrunk every quarter over the past year, coinciding with the overall downward trajectory of the entire online advertising market.

Additionally, LinkedIn’s sales growth slowed to 17% in Microsoft’s fiscal first quarter, down from 42% in the same quarter of 2021.

Microsoft CFO Amy Hood told analysts on an earnings call that “a decrease in customer ad spend, which also weakened toward the end of the quarter, impacted search in advertising solutions.” LinkedIn advertising and marketing.”

Meanwhile, Meta is expected to report a second straight quarter of declining sales on Wednesday, underscoring the current turmoil in online advertising. Judging from the recent earnings reports of various tech giants, it is unlikely that Meta will report any signs that the online advertising market is set to recover.

Alphabet misses both revenue and EPS, up slightly on Google cloud


Goz News: Update the world's latest breaking news online of the day, breaking news, politics, society today, international mainstream news .Updated news 24/7: Entertainment, the World everyday world. Hot news, images, video clips that are updated quickly and reliably.

Related Articles

Back to top button