Alphabet-owned YouTube’s ad revenue continued to decline during the first fiscal quarter of 2023 as advertisers are cutting their budgets amidst the global economic slowdown. The company reported an ad revenue of $6.69 billion for the quarter, down 2.6% from $6.87 billion in Q1 2022.
While this is the third quarter in a row that YouTube has experienced a decline in ad revenue, it still managed to meet analysts’ forecasts of $6.6 billion.
Also Read: YouTube Revenue and Usage Statistics
Amidst strong competition from rivals such as TikTok and Instagram, YouTube remains committed to leveraging its short-form video feature ‘’Shorts’’ to drive more growth. Earlier this year, Google revealed that Shorts now generate more than 50 billion views on a daily basis. The service gained new shopping features late last year, and YouTube recently started giving 45% of Shorts ad revenue to creators in an effort to lure more users.
“Last year the number of channels that uploaded to Shorts daily grew over 80%. Those posting weekly on Shorts saw the majority of new channel subscribers coming from their Shorts posts,” said Google and Alphabet CEO Sundar Pichai during the company’s earnings call.
“We’re seeing strong watch time, growth… monetization is also progressing nicely. People are engaging and converting on ads across Shorts at increasing rates,” added Google’s Chief Business Officer Philipp Schindler.
They also talked about the company’s plans to bring more shopping capabilities to the platform. In July last year, YouTube announced a partnership with Shopify for the integration of various e-commerce features.
‘’Shopping on YouTube. It’s still super early days,’’ said Schindler. ‘’One highlight. Last year, we brought shopping to more creators and brands by partnering with commerce platforms like Shopify. Now more than 100,000 creators, artists and brands have connected their own stores to their YouTube channels to sell their products. We’re excited about the potential ahead.’’
For the first fiscal quarter of 2023, YouTube’s owner Alphabet reported a revenue of $69.8 billion, up 3% Y/Y. During the quarter, the tech giant laid off 6% of its workforce, which impacted around 12,000 roles.