YouTube and Google drive Alphabet to $15bn revenue
Alphabet’s range of digital subscription services generated $15 billion in revenue for 2023, as revealed in the company’s 2023 Q4
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Alphabet’s range of digital subscription services generated $15 billion in revenue for 2023, as revealed in the company’s 2023 Q4 Earnings Call, yesterday.
The parent company of Google has benefited significantly from its offerings including YouTube Premium, YouTube Music, YouTube TV as well as Google One cloud storage.
In an address from Alphabet CEO Sundar Pichai, the Indian-American executive detailed the fivefold increase in revenue from subscriptions since 2019, but no breakdown was provided on the number of subscribers or volume of revenue per platform.
Pichai stated, “YouTube is the key driver of our subscription revenues. YouTube Music and Premium have real momentum. They are engaging passionate users and driving great returns for the music industry and creators.”
He added that YouTube TV is “also doing well”, pointing out the NFL Sunday Ticket agreement “has found its perfect home on YouTube.”
That deal, described by the 51-year-old University of Pennsylvania graduate, saw out-of-market games screened exclusively in the US on YouTube over the 2023 season.
The S&P 500 finished essentially flat on Tuesday while the Nasdaq fell 0.76% and the Dow Jones rose 0.35%. Shares of Alphabet and Microsoft fell in extended trading after the companies released their quarterly earnings reports https://t.co/v0oW8Wgnh9 pic.twitter.com/OJJcGnJZ7x
— Reuters (@Reuters) January 31, 2024
Subscriptions and strategy
During the Earning’s Call, Google’s chief business officer Philipp Schindler added on the prestigious football link-up:
“NFL Sunday Ticket supports our long-term strategy and really helps solidify YouTube’s position as a must-have app on everyone’s TV set,” he said.
He said Google was “pleased” with the amount of sign-ups for the NFL package on both YouTube TV and standalone YouTube but again, there was no specific detail on the number of Sunday Ticket customers for year one. Schindler went on to say the company is “closely” considering the possibility of taking Sunday Ticket to markets outside the US.
The Earnings Call revealed Alphabet’s cost of revenues (excluding traffic acquisition costs) for Q4 was $23.6 billion, up 5% with the increase largely contributed to by content acquisition-related costs from YouTube subscription offerings.
For the same period, YouTube’s ad revenue was $9.2 billion, an increase of 15.5% year on year, in line with Wall Street expectations.
Ultimately, Alphabet beat expectations with a revenue return of $86.31 billion, up 13.5%, with earnings of $1.64 per share.
The Alphabet Q4 2023 Earnings Call can be viewed in full, below.
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