Google is the leader in Ad industry
The Interactive Advertising Bureau published an annual report on the current state of the digital advertising market in this week. This is the statement given in the report; It showed that things went well for Google and Facebook, but it was not possible to say the same for other companies in the market. Facebook and Google provide more than two-thirds of the growth in the digital advertising industry. The strength of this situation is clearer with the Alphabet finance report of the first quarter of 2017.
Alphabet’s financial report for the first quarter of the year shows how profitable the internet giant’s advertising is. Search ads, screen ads and ads shown on YouTube videos helped the company enter $ 24.75 billion in the first quarter of the year. This represents a 22 percent increase over the same period last year. Google closed the quarter with a net profit of $ 5.42 billion, an improvement of 29 per cent compared to the same period last year. Google’s success also added 3 percent to Alphabet shares after the report was released.
The quarter we passed for YouTube was not that easy. The appearance of major brands’ ads alongside offensive language or violent videos has bothered many companies. This disturbance later became a boycott. The boycott effects, which began in March, are not reflected in the first quarter results announced.
Most of the quarterly results of Alphabet constitute the category bearing “Other Jobs”. Beneath this category are a number of initiatives ranging from balloon-based internet connection projects to driverless cars and energy generating kites. Alphabet CFO Ruth Porat said they are continuing to take advantage of their ongoing investments in production innovation and have a strong momentum in their new venture under the Alphabet roof.
However, figures from the first quarter do not fully support Porat’s words. Other business units’ revenues increased by 48 percent compared to the same period of previous year, reaching 244 million dollars, but the unit period ended with a loss of 855 million dollars. We should not be surprised to see that the projects under the roof of the unit are R & D initiatives that have not yet had a business model.