Google Ad Surge Drives Up Profits for Parent Firm Alphabet

Technology

April 28th, 4:46am

Asharq Al-Awsat

Letters spell the word "Alphabet" as they are seen on a computer screen with a Google search page in this photo illustration taken in Paris, France. Reuters

Google parent Alphabet on Tuesday reported that quarterly profit more than doubled as digital advertising surged with more people relying on the internet during the coronavirus pandemic. Profit in the first quarter leapt to $17.9 billion from $6.8 billion in the same period a year ago while revenues jumped 34 percent to $55.3 billion, led by gains in advertising and cloud computing services. "Over the last year, people have turned to Google Search and many online services to stay informed, connected and entertained," said Alphabet and Google chief executive Sundar Pichai. The surge in Alphabet's earnings comes as the tech giant faces increased scrutiny from regulators regarding its power. "Google essentially manufactures money; they are almost entirely ads," said analyst Rob Enderle of Enderle Group. "There is not a risk of downturn in revenue, it is that regulatory action strips the revenue from them." Facebook and Google are the "short list" when it comes to scrutiny by regulators in Europe and the United States because of "their broad impact on the political process and almost complete dominance of ad revenues," the analyst maintained. Google is among internet giants in the crosshairs of regulators and critics concerned about whether it unfairly wields its power to dominate markets and fend off competition. The Silicon Valley giant reported robust gains in search advertising, those messages tied to the leading internet search engine, as well as for its YouTube video sharing platform. "People have turned to Google search more than ever since the pandemic began," Pichai said on an earnings call, noting queries ran a gamut from Covid-19 questions to job hunts. While the pandemic has brought tremendous challenges for small businesses, it has also created opportunities for entrepreneurs to tailor offerings for new trends, according to Google chief business officer Philipp Schindler. "Consumers are spending more time online; they're buying more online, and they were willing to try new brands and eager to support local businesses," Schindler said on the call. The pandemic has sped up a trend in people using the internet for shopping, work, learning and entertainment. Google is a centerpiece of online activity, with offerings such as its search engine, ad marketplace, and YouTube video platform.

from Asharq AL-awsat https://english.aawsat.com/home/article/2943751/google-ad-surge-drives-profits-parent-firm-alphabet