Alphabet posted a strong second quarter, with Google Cloud revenue climbing 28 percent year-over-year, to $8.03 billion, and overall revenue gaining 7 percent, to $74.6 billion, exceeding analyst expectations, as did the $18 billion in net income. Google Search ad sales grew by nearly 5 percent, to $42.6 billion, while ad sales from Google’s YouTube streaming platform rose almost 4 percent, to $7.7 billion. YouTube had in recent quarters sustained revenue declines, attributed to increased competition from TikTok and others, but was finally able to reverse the downward trend.

YouTube Shorts were watched by more than two billion logged-in users monthly in Q2, up from 1.5 billion in Q2 2022, Alphabet and Google CEO Sundar Pichai told analysts on the earnings call, flagging that the streamer will have its first NFL Sunday Ticket football season this fall. Cloud revenue climbed to $8 billion in Q2, a 28 percent increase compared to a year ago.

Alphabet’s steady-to-improving performance in tumultuous times reflects the fact that “Google’s size and reach have given it more advantages in weathering the terrain,” reports The New York Times, adding that smaller competitors have not been as lucky and the recovery not universal. “Snap, the parent of Snapchat, posted a second straight quarterly sales decline on Tuesday, in a sign that the ad landscape remained rocky,” NYT notes.

While holding steady, Alphabet has not been unaffected by market challenges. “For the fourth straight quarter, Google’s parent company reported growth in the single digits as it reckons with a pullback in digital ad spending that reflects concerns about the economy,” CNBC writes, adding that “analysts don’t expect growth to hit double digits again until the fourth quarter.” Despite the uncertainty, Q2 profits were up about 15 percent, to nearly $18.4 billion.

Alphabet SVP and Chief Business Officer Philipp Schindler said that as of Q2 nearly 80 percent of advertisers were using “at least one AI-powered Search Ads product.”

NYT points out that “despite concerns of growing AI competition from the ChatGPT chatbot and Microsoft’s Bing search engine, Google’s search engine has remained a central gateway to the web for billions of users,” convincing advertisers “that its sites are still a reliable way to reach consumers.”

Alphabet also announced that Ruth Porat, CFO since 2015, is exiting that role to assume the newly created position of president and chief investment officer. On September 1, she will begin overseeing Alphabet’s experimental businesses, aggregated under “Other Bets,” exploring investment opportunities and engaging with policymakers.

Related:
Google Says 2 Billion Logged in Monthly Users Are Watching YouTube Shorts, TechCrunch, 7/25/23
YouTube Q2 Ad Sales Rise 4.4%, Alphabet Handily Tops Earnings Estimates, Variety, 7/25/23
Alphabet’s Digital Advertising and Cloud Revenue Rises, Financial Times, 7/25/23
YouTube Ads Are Back on an Upswing as Revenue Hits $7.7B, The Hollywood Reporter, 7/25/23