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Alphabet's ad revenue reaches US$18bn

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Advertising revenue from Google in the first quarter of 2016 rose 16% to US$18 billion, compared with the year-ago quarter, driven by strong advertising sales on mobile devices.Google's parent company Alphabet reported consolidated revenue was US$20.3 billion, up 17% year-over-year.The company said the number of ads, also known as paid clicks, jumped 29%. However, cost-per-click, or the average price of online ads, fell 9% in the quarter.Chief financial officer Ruth Porat said that the shift from desktop search to mobile and programmatic advertising came with higher costs of reaching users, which was weighing on profit margins.The Silicon Valley company, which reorganised itself into a holding company called Alphabet last year, gets nearly all of its revenue and all its profits from the core Google search and advertising business.Google CEO Sundar Pichai said on a conference call with investors that Google is on the forefront of machine learning and artificial intelligence, name dropping its recent breakthroughs with AlphaGo. He said that this technology was at the heart of Google's success in optimising its advertising and growing its cloud services.Google's other revenues segment, which covers business like hardware sales and Google Play, also grew well this quarter. Revenue of nearly US$2.1 billion was a 24% increase over Q1 in 2015.Google still dominates the world of online advertising, controlling a third of all worldwide digital ad revenue in 2015, according to research from eMarketer.

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