Alphabet, parent company of Google and YouTube, shared its financial results for the third quarter of its fiscal year. Alphabet managed to increase revenues overall, but saw a decline in net profit and ad revenue. Accordingly, the meltdown in YouTube’s advertising revenues continued.According to shared data, YouTube’s ad revenue fell 2.6 percent year on year as advertisers withdrew from the platform due to economic uncertainty. YouTube had $6.87 billion in ad revenue in the same period last year. This number fell to $6.69 billion in the first fiscal quarter of 2023.
YouTube’s ad revenues are melting
Although YouTube’s advertising revenues were disappointing, it managed to slightly exceed analysts’ expectations of 6.6 billion dollars. On the other hand, the most important statistical data is that YouTube’s advertising revenue has been falling for three consecutive quarters. The numbers sliding down are also a concern for creators looking for ad revenue to generate revenue.
In the statements made, the successes of YouTube’s short video feature Shorts were mentioned while the authorities tried to give reassurance. Sundar Pichai, CEO of Google and Alphabet, said, “The number of channels creating videos for Shorts has increased by over 80 percent in the last year. Weekly broadcasters at Shorts have seen the majority of new channel subscribers come from Shorts posts.” said.While the platform faces intense competition from competitors like TikTok, the company continues to focus on Shorts to drive growth. In November 2022, YouTube made Short videos available on smart TVs. Google announced in February that Shorts had reached 50 billion daily views. According to Philipp Schindler, chief operating officer of Google, watch times are advancing strongly and growth continues. Schindler also underlined that the return in the advertisements was strong while using the expressions “monetization is also progressing well”.
Finally, YouTube also wants to enable shopping directly on the platform. The company partnered with Shopify last year to enable YouTubers and merchants to feature products on their channels. Although it’s only at the beginning, more than 100,000 creators, artists and brands have now connected their stores to their YouTube channels to sell their products.
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