JVPass - Technology and Trending Blog

YouTube Revenue Drags, Record Lowest Growth In Last Two Years

Youtube revenue in the second quarter of 2022 reportedly slowed and recorded the lowest growth in the last two years.

According to a report by Alphabet – the parent of Google and Youtube – YouTube ad revenue only grew 4.8 percent in the second quarter of 2022 compared to the same period in 2021 (year-on-year/yoy), to a value of 7.34 billion US dollars (around Rp. 111.1 trillion).

This figure misses analysts’ estimates that YouTube ad revenue for the second quarter of 2022 will rise 7 percent to 7.49 billion US dollars (Rp 112 trillion).

Youtube ad revenue growth is indeed low when compared to the second quarter of 2021. At that time, Youtube revenue rose 84 percent to 7 billion US dollars (Rp 104.7 trillion) due to the pandemic.

Alphabet’s CFO, Ruth Porat, in the company’s earnings report also attributed the slow YouTube ad revenue to a significant comparison of growth during the pandemic, especially in the second quarter of 2021. According to him, it is quite natural when growth rises significantly and then falls like the wheel of life.

“Time will take us through the loop. So that’s a clear calculation,” Porat told analysts.

In addition to this cycle, Porat also mentioned the efficiency of clients advertising on Youtube to be another cause amid the current macroeconomic uncertainty.

Meanwhile, according to analysts, the decline in Youtube ad revenue was also influenced by Youtube Shorts, YouTube’s short video feature similar to TikTok.

YouTube says its company has already started monetizing Shorts, by testing the ads in it. However, this trial has only been running for the last few months, so the results cannot be measured yet.

It should be noted that the Youtube advertising revenue mentioned above does not include the company’s revenue from YouTube Premium and Youtube TV subscriptions.

Earlier this July Google said that Youtube TV already has 5 million subscribers and free trial users. This achievement makes Youtube TV surpass Disney Hulu which is the largest online pay TV service in the US.

Google Cloud is selling well

In contrast to Youtube, Google Cloud actually achieved impressive growth in the second quarter of 2022. The virtual storage service’s revenue rose 36 percent (YoY) to USD 6.28 billion (Rp 93.9 trillion), although its operating loss also rose to USD 858 million (Rp 12.8 trillion).

At the same time, Porat said his company would delay hiring a bit even though it continued to recruit key positions.

“Although we expect growth in the number of employees to stagnate next year, we will continue to recruit important positions, especially for the best technical and technical talent,” he said.

Until the second quarter of 2022, Alphabet was recorded to have 174,014 employees, an increase of around 10,108 people compared to the previous quarter, as compiled by KompasTekno from Variety, Thursday (28/7/2022).

Share Me On
Get Code

Leave a Comment