Dive Brief:
- Alphabet Inc. and Google CFO Ruth Porat said in the Q4 2015 earnings call that YouTube revenue “continues to grow at a very significant rate” driven by video advertising across TrueView and Google Preferred networks.
- Meanwhile, Google CEO Sundar Pichai said in the same call that product listing ads over the extended Black Friday period generated more revenue from mobile ads than desktop ads.
- This is the first call that Alphabet separates out Google from its "other bets." Google’s net revenue was $17.3 billion on $8.67 earnings per share, exceeding analysts’ expectations of $16.9 billion in revenue.
Dive Insight:
Alphabet, Google's parent company, has swept past Apple to become the most valuable public company in the world. CFO Porat attributed much of the company's growth to mobile search.
Discussing the impact of mobile, CEO Pichai said, "Mobile is really helping us making these connections for marketers. As Ruth mentioned, Mobile Search was particularly strong in the fourth quarter. This holiday season, we found that shopping moments replaced shopping marathons. Shoppers turned to their mobile devices to purchase gifts online in spare moments throughout the day all season long, and marketers turned to our mobile ad offerings to reach those customers."
He added that internal research found 30% of all online shopping purchases now happen on mobile phones.
Porat also said Google's video advertising network income was $4.1 billion, up 7% year-over-year and up 12% sequentially, singling out the strong growth of programmatic contributing to these results. She added aggregate paid clicks grew 31% year-over-year and aggregate CPCs were down 13% year-over-year. For Google Sites, paid clicks were up 40% and CPCs down 16%.
"The movement in Google Sites paid clicks and CPCs primarily reflects the continued growth in YouTube TrueView," Porat said. "Network paid clicks were up 2% year over year and up 1% sequentially. Network CPCs were down 8% year over year and up 7% sequentially. Total traffic acquisition costs were $4.1 billion or 21% of total advertising revenue, up 14% sequentially and up 12% year over year."
As more and more consumers opt for mobile or participate as second- and third-screen users, Google has leveraged that behavior change to focus on building out its mobile offerings.