Alphabet’s net profit jumped nearly 43 per cent year-on-year in Q4 2020, propelled by a ramp in advertiser spending across its YouTube and Search platforms.
On an earnings call, CFO Ruth Porat called the period a “great end to a challenging year”, adding “each component of our advertising revenues reflects the return of advertiser spend in response to the continued movement of consumer activity online”.
Net income hit $15.2 billion on revenue of $56.9 billion, up 23.5 per cent.
Advertising revenue increased 21.8 per cent to $46.2 billion, with Google Search contributing $31.9 billion and YouTube $6.9 billion.
Google Cloud revenue grew 46.5 per cent to $3.8 billion, though in a first-time disclosure Alphabet noted the unit posted an operating loss of $1.2 billion. Porat said this was “essentially flat” and reflected investments in the division’s go-to-market organisation, engineering and technical infrastructure.
Sales from its Other segment (comprising hardware, cloud services and its Play Store) increased 26.8 per cent to $6.7 billion. Porat said Fitbit revenue will be included in this unit in future after an acquisition was sealed [1] last month.
Porat said Play Store app revenue “continued to benefit from elevated levels of engagement, reflecting increases in active buyers and spend per buyer due to” Covid-19 (coronavirus).
Revenue at its Other Bets division, including Waymo, increased from $172 million to $196 million.
[1] https://www.mobileworldlive.com/featured-content/top-three/google-concludes-fitbit-takeover
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