“Q1 saw strong growth in Search and Cloud,” says Sundar Pichai, CEO of Alphabet

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The fiscal year 2021 was definitely great for Google’s parent company Alphabet. The company reported annual revenue of more than $200 billion in the last year in spite of the issues faced due to the COVID-19 pandemic. The company had also reported $75.3 billion quarterly revenue which was an increase of around 32% compared to Q4 2020.

The company recently announced its Q1 2022 results after which it saw a more than 4.5% dip in its stock. The revenue reported in this quarter also fell short of analysts’ expectations.

“We are pleased with Q1 revenue growth of 23% year over year. We continue to make considered investments in Capex, R&D and talent to support long-term value creation for all stakeholders”

-Ruth Porat, CFO of Alphabet

“We are pleased with Q1 revenue growth of 23% year over year. We continue to make considered investments in Capex, R&D and talent to support long-term value creation for all stakeholders,” said Ruth Porat, CFO of Alphabet and Google.

Alphabet reported $68.01 billion in revenue which is lower than the $75 billion it reported in the previous quarter and also slightly lower than the $68.11 billion that the company predicted. But the numbers reported are also up by 23% compared to Q1 2021.

Growth Drivers in Q1 2022

Google‘s ads business brought in the maximum revenue in this quarter, reporting $54 billion revenue out of which $39 billion was brought in by Search alone. Google Cloud, while being fairly new has shown quick growth in this quarter. Its sales grew by 43% generating $5.8 billion in revenue. However, Google Cloud is still not profitable for the company.

Sundar Pichai, CEO of Alphabet said, “Q1 saw strong growth in Search and Cloud, in particular, which are both helping people and businesses as the digital transformation continues. We’ll keep investing in great products and services, and creating opportunities for partners and local communities around the world.”

YouTube ad revenue was reported at $6.8billion which not only displayed slowed growth but also fell short of what analysts were expecting. Amidst the lockdown and the COVID-19 pandemic, YouTube ads saw around 30% growth last year but only went up to 20% this year. This could also be because of the increased competition.

“Q1 saw strong growth in Search and Cloud, in particular, which are both helping people and businesses as the digital transformation continues.”

– Sundar Pichai, CEO of Alphabet

Sundar Pichai pointed out during Alphabet’s Earnings Call that YouTube Shorts has reached 30 billion daily views, which is four times more as compared to the last year. The platform also has more than 2 billion monthly signed-in users. He also spoke about plans and features that will enhance users’ experience while using YouTube.

Also Read:  Google’s backing for ShareChat in a $300 million funding round pushes its valuation to $5 billion dollars

Amidst the ongoing Russia-Ukraine crisis, the company previously stopped its operations in Russia. Due to this, the revenue growth in the European region has slowed to 19% in Q1 2022 from 33% last year.

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