YouTube Revenue Surpasses $60b as Alphabet Exceeds $400b
Alphabet reported record $403bn revenue as YouTube crossed $60bn, with AI-driven ad tools and subscription growth shaping its strategy.
Topics
What to Read Next
Alphabet reported consolidated revenue of $403billion, marking the first time the company has exceeded $400billion in annual revenue.
Advertising revenue increased 13.6% year on year to $82.3billion in the fourth quarter. Search and other advertising, the company’s largest segment, rose 16.7% to $63.1billion over the same period.
YouTube generated more than $60billion in revenue across advertising and subscriptions. In the fourth quarter, YouTube advertising revenue grew 8.7% to $11.4billion, supported by direct-response formats during the holiday season.
Growth was slower than in the previous year, reflecting elevated political advertising spend in 2024. Executives said the business is increasingly assessing YouTube’s advertising and subscription revenues together.
Philipp Schindler, chief business officer at Google, said that when users move from ad-supported viewing to paid services such as YouTube Music or Premium, advertising revenue may decline, but overall business revenue can rise.
Also Read: Rising Ad Spend On YouTube, Search, Shopping Drive Record Q2 Results At Google
YouTube TV is expected to introduce additional plan options. According to estimates from Nielsen, YouTube has ranked as the leading streaming platform on connected television screens for nearly three consecutive years. The platform has also secured rights to broadcast the Oscars from 2029.
Google is testing new advertising formats on connected televisions, including shoppable ad experiences. The company said these formats are intended to support direct-response objectives and retail performance.
Artificial intelligence featured prominently in the earnings update. Sundar Pichai said the Gemini app experienced strong growth in the fourth quarter. Google stated that AI is being used to improve advertising quality, enhance advertiser tools and develop new user experiences.
In the fourth quarter, advertisers created nearly 70 million assets using Gemini features within AI Max and Performance Max campaigns. Schindler said AI systems have reduced the number of irrelevant adverts served.
Also Read: Meta Reportedly Planning Retail Stores As It Pushes Into Metaverse
Google is also expanding AI partnerships beyond its own services. Apple has partnered with Google to integrate Gemini models into features, including Siri. Retailers such as Target and Walmart are working with Google to explore applications of agent-based commerce.
Capital expenditure reached $91.4billion, largely driven by AI investment. The company expects spending to increase to between $175billion and $185billion in 2026.
For marketers, the results point to continued growth in video and search advertising, alongside increasing emphasis on AI-enabled campaign tools and subscription-based revenue models.
