The parent company of Google, Alphabet reported profit and earnings for the third quarter that surpassed expectations.
Google’s advertising revenue jumped 43% to $53.13 billion. In the third quarter of 2020 Google’s advertising revenue was $37.1 billion. The revenue of YouTube ads rose to $7.21 billion, up from $5.04 billion a year ago.
The company appears to be managing through privacy changes that its rival Apple made to iOS 14 earlier this year. Facebook and Snap both cited the change, which allows users to opt-out of targeted ads on apps, as the main reason for business disruption during the period. Google is more protected than the companies stated above because it owns the Android operating system.
Google’s chief business officer revealed one very interesting detail. Philipp Schindler stated that retail was the largest contributor to year-over-year growth. Finance spending and media also played an important role in the company’s success.
Alphabet and its results
Alphabet also revealed other interesting details. Google’s cloud division’s revenue rose 45% to $4.99 billion. Its operating loss shrank to $644 million from $1.21 billion. Alphabet invested a lot of money in its cloud division, which is led by former Oracle executive Thomas Kurian. Google’s parent company is trying to compete with Amazon and Microsoft.
Furthermore, revenue from the Other Bets segment, which includes the self-driving car company Waymo reached $182 million. In the previous quarter, the revenue was $178 million. Losses widened to $1.29 billion in the third quarter from $1.1 billion a year earlier.
The company reported a gain on investments of $188 million in the third quarter of the year, up from a gain of $26 million a year earlier. Its investment arms, which bet on star-ups at various stages, benefited from the IPO of cloud software developer Freshworks. It also benefited from the IPO of restaurant-tech vendor Toast.
In the third quarter, Alphabet added 6,000 employees. Alphabet expects robust headcount growth in the fourth quarter according to Alphabet’s financial chief Ruth Porat.