Google And Microsoft Roar in Q1 2021
This is the age of digital. This is the age of Google. And the numbers are making the case: YouTube ad revenue grew 50% to $6 billion in Q1 2021, getting closer to the Netflix range. That is a record acceleration.
A pick up in the advertising business pushed Alphabet revenue higher across the board, sending its stock soaring in after-hours trading and marking the tech giant's third straight quarter of record profits. The Google parent's ad business rose on the back of the vaccine-led recovery with YouTube ad revenue growing 50% to $6 billion. Yahoo Finance noted that Alphabet had underperformed its tech peers last year, but shares have risen 30% year-to-date. Alphabet's chief financial officer said "elevated online activity" during the pandemic was a boon to the core business, and they don't expect it to last as restrictions are largely lifted. (LinkedIn)
The is the summary from Fortune newsletter: strong and dominant American tech firms.
At least for the first quarter, the pandemic-induced tech boom is still strong. Microsoft reported that its sales grew 19% to $41.7 billion, better than analysts forecast, led by its Azure cloud unit and sales of Xbox gaming consoles (which could have been even better if not for the global chip shortage). “Over a year into the pandemic, digital adoption curves aren’t slowing down. They’re accelerating,” CEO Satya Nadella said.
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At Google, advertising is booming as more people 49 and under watch YouTube videos than old-fashioned TV. Overall sales rose 34% in the quarter to $55.3 billion, led by a 49% increase at YouTube and 46% gain from Google Cloud. Some analysts now think YouTube could match Netflix’s expected annual revenue of $30 billion this year. But CFO Ruth Porat was a little more conservative in her outlook than Nadella. “It’s too early to forecast the extent to which these changes in consumer behavior and advertising spend will endure,” she said on a call with analysts. Noting sales of work-from-home gear probably wouldn’t continue, she added, “We think it’s premature at this point to really assess how durable this consumer behavior trends are.”