Google on Monday released data on its YouTube and cloud computing businesses for the first time in its fourth quarter of 2019 results.
YouTube's advertising revenue in fy2019 was $15.15 billion, reaching $4.72 billion in the fourth quarter alone. The division's fy18 revenue was $11.16 billion, including $3.61 billion in the fourth quarter of the year. This data does not include YouTube's non advertising revenue (such as YouTube TV's subscription revenue), which is included in Google's "other revenue.".
According to Ruth Porat, Google's CFO, YouTube's non advertising business generated $3 billion a year in fourth quarter data. She added that most of YouTube's advertising revenue went to creators, but Google did not disclose specific figures.
Google's cloud business generated revenue of $8.92 billion in fiscal 2019, of which $2.61 billion in the fourth quarter. By contrast, cloud computing revenue in 2018 was $5.84 billion, compared with $1.71 billion in the fourth quarter of that year.
After hours, the stock price of alphabet, Google's parent company, fell about 3.5%.
Analysts have long called on Google to report YouTube revenue separately because it is considered an important part of its advertising business. Comparing YouTube's revenue with that of another media company, its advertising revenue in 2018 is higher than that of discovery: Discovery's annual revenue is $10.6 billion, while YouTube's revenue is $11.16 billion. Discovery has yet to report full year 2019 results.
Google's cloud business is relatively young but developing rapidly. It hopes to surpass Amazon AWS and Microsoft azure. Google said in July that its cloud computing business generated just $8 billion in annual revenue and plans to triple its sales force in the next few years.
Sundar Pichai's first financial report, led by alphabet, Google's parent company, came as a step toward greater transparency. Larry Page, former CEO and co-founder of alphabet, stepped down in December last year, with Pichai in charge of a broader business. Page and co-founder Sergey Brin both resigned as president of alphabet, but still retained the company's controlling vote.
Google has been closely watched by federal and state regulators for signs of unfair competition. A coalition of 50 attorneys’ general from different states and regions announced an investigation into Google's advertising business. The new disclosure program gives investors a deeper understanding of Google's advertising businesses.
