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Google ad revenue on the rise hitting US$22.04 billion

Google parent company Alphabet has revealed that it saw a rise in revenue of 24% year-on-year (yoy) from around US$22.45 billion in 2016 to US$27.77 billion this year. Out of the total revenue, Google contributed to US$27.47 billion, up from US$22.25 billion the year before. Advertising revenue was at US$22.04 billion, up from US$19.82 billion from the year before.

Meanwhile, according to Alphabet’s balance sheets, the parent company’s APAC revenue was at around US$4.20 billion, according to generally accepted accounting principles.

Read also: Your Google search history will now impact the ads you see on YouTube

In February this year, Google agreed to open up its YouTube ad inventory and ad buying platforms for audit by the Media Rating’s Council. In the same month, YouTube also killed its 30-second unskippable ad format. In September, YouTube unveiled new tools to help companies capture consumers’ attention on its platform. These are “Video Ad Sequencing”, “Custom Affinity Audiences”, “Director Mix”.

According to Bloomberg, Alphabet also saw good performance from Google’s YouTube video platform and cloud business. The report added that YouTube garnered 100 million viewing hours per day in the living room, which was a 70% increase in the past year. A primary focus for investors was also said to be Google’s traffic acquisition costs (TAC), as well as payments to phone-makers and web browser makes which run Google search and ads.

Total TAC was at US$5.50 billion this year, up from US$4.18 billion the year before. The total TAC made up 23% of Google’s advertising revenue, up from 21% the year before. In the Bloomberg report, Ruth Porat, CFO of Alphabet, attributed the acceleration of TAC to wider adoption of mobile devices. This saw Google paying more for search access and changes in partner agreements. The partners were not specified.

In a press statement on the financial results, Porat said that the results reflect strength across Google and other bets. She added that the momentum was a result of “investments over many years in fantastic people, products and partnerships.”

In a press statement on the financial results, Porat said that the results reflect strength across Google and other bets. She added that the momentum was a result of “investments over many years in fantastic people, products and partnerships.”

Most recently, Google unveiled its new Pixel 2 phone, launching an ad campaign consisting of several videos to promote its new Pixel 2 smartphone. True to previous Pixel ads which mocked Apple, in the new spot Google made several jibes at the Apple iPhone. In October, Google replaced its First Click Free model with the new Flexible Sampling model. This is to allow publishers to decide how many, if any, articles they wish to offer to readers and potential subscribers depending on their business strategies.

 

 

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