Math fails Alphabet as profits slump 23% despite ad sales rise

By John Glenday | Reporter



profits article

October 29, 2019 | 3 min read

Google parent Alphabet has suffered a 23% slump in operating profits as losses incurred by wayward investments took their toll on its bottom line, despite ad sales posting a healthy rise.

In its latest set of quarterly results, the tech titan was beset by mounting costs which undermined the continued steady performance of its digital advertising income.


Math fails Alphabet as profits slump 23% despite ad sales rise

Advertising remains the bedrock of Alphabet’s operations with revenue jumping to $33.92bn over the third quarter versus $28.95bn in the three months prior, with half of all search spend now accrued from automated bidding.

Such is the importance of advertising to Google that the sector now accounts for 85% of total revenues, which stood at $40.5bn for the quarter.

The latest marketing news and insights straight to your inbox.

Get the best of The Drum by choosing from a series of great email briefings, whether that’s daily news, weekly recaps or deep dives into media or creativity.

Sign up

Profits headed in the opposite direction however, slipping by $1.7bn over the period, brought down by the highest quarterly expenses yet recorded by the internet staple amid heavy investment in cloud computing and consumer electronics.

Updating analysts on the numbers, Google chief executive Sundar Pichai said: “We’ve evolved from a company that helps people find answers to a company that helps you get things done.”

Now is a critical time for Google which awaits the outcome of several regulatory investigations into its operations which have the potential to further undermine growth, including accusations it has rigged the Android and search markets.


Content created with:

Google is an American multinational technology company providing Internet-related services such as search, online advertising, cloud computing, software and hardware.

Find out more

More from Advertising

View all


Industry insights

View all
Add your own content +