YouTube’s revenue growth cooled in the second quarter of 2020, but even with the COVID-19 pandemic Google’s internet video platform carved out year-over-year growth of 5.8%. Alphabet, Google’s parent company, posted a 2% decline in revenue — its first-ever revenue drop — while it still topped Wall Street estimates.
For Q2, YouTube’s ad revenue was $3.81 billion, up from $3.60 billion in the year-ago period. But sales for the period were down from $4.04 billion in the first quarter, when YouTube’s advertising revenue boomed 33%.
Google “Search & Other” revenue was down 9.8% year over year, dropping by $2.3 billion to $21.32 billion for Q2.
“In the second quarter our total revenues were $38.3 billion, driven by gradual improvement in our ads business and strong growth in Google Cloud and Other Revenues,” said Ruth Porat, CFO of Alphabet and Google. “We continue to navigate through a difficult global economic environment.”
Alphabet overall posted $38.30 billion in revenue (down 2%) while net income of $6.96 billion ($10.13 per share) represented a 43% decline. Analysts had forecast Alphabet second-quarter revenue coming in at $37.36 billion with EPS of $8.34.
With the ad softness, other lines of business — including YouTube subscriptions, Google Play and Google Cloud — grew to help offset the decline, according to Alphabet and Google CEO Sundar Pichai. Sales in the Google Cloud business jumped 43%, to $3.01 billion.
“As people increasingly turn to online services, our platforms — from Cloud to Google Play to YouTube — are helping our partners provide important services and support their businesses,” Pichai said.
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