YouTube Ad Revenue Drops by $200 Million This Quarter Due to Coronavirus Pandemic

In spite of the fact that a lot of big businesses were negatively impacted by the coronavirus pandemic, a lot of internet based companies started seeing a boost in their profitability. A big part of the reason why that is the case has to do with the fact that people didn’t really have anywhere to go, so streaming Netflix or watching YouTube videos seemed like the only thing that they could potentially end up doing in their free time. Social media platforms also saw increased usage as did video calling platforms such as Zoom.

However, it seems like the boost that these businesses had been seeing has slowed down to certain extent. YouTube’s ad revenue in the previous quarter were $4 billion, a $400 million increase from the $3.6 billion in ad revenue the video streaming service ended up seeing in the same quarter last year. However, this quarter their revenues fell by $200 million, indicating that things are catching up to the tech industry as well. The $3.8 billion in ad revenue that YouTube made is still an improvement over last year, but with all of that having been said and out of the way it is important to note that these kinds of companies rely on strong growth to keep their shareholders fully satisfied with whatever it is that they happen to be doing.

One reason behind this decline according to communications sent out from Alphabet CFO Ruth Porat to investors and analysts is that brands were advertising a lot less. This is because of the fact that they were wary of having their imagery and branding associated with the current pandemic. However, according to Porat, YouTube is already seeing a bounce back due to increased brand spending on ads so this might just be a temporary blip although we will have to wait and see if that’s truly the case.

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