Mobile search boosts Alphabet Q2 ad revenue

Alphabet recently unveiled its Q2 2018 financial results, highlighting that mobile search is still its biggest source of revenue.

Overall, the company generated revenue of $32.7 billion, an increase of 26% year-on-year and mobile search leading the chart. $28.1 billion of that revenue came from advertising.

However, the rise in mobile search meant that Alphabet had to pay higher traffic acquisition costs for phone makers. A total of $6.4 billion went to traffic acquisition, down to 23% from 24% in the previous quarter. Alphabet had worried investors back in February that traffic acquisition costs may increase further over the year. The latest figures may therefore come as a relief.

However, traffic acquisition still represented 22.8% of its advertising revenue.

Financial highlights Alphabet Q2 2018

Source: Alphabet

Meanwhile, paid clicks on Google ads were up 58% whilst cost-per-click decreased 22% compared to 2017. Impressions also saw a small jump of 1% across Google properties whilst cost-per-impression increased 14%.

Google has recently shifted focus toward more responsive search ads and incorporation of machine learning technologies. This has driven up costs for skilled staff slightly.

Additionally, the company is strengthening its video and monetisation support for YouTube creators. Video views continue to increase each year with smartphones becoming popular secondary screen options. According to eMarketer research, video ad spend is reaching $17 billion in 2018.

YouTube recently entered a partnership with TeeSpring to allow video creators to promote their merchandise through paid channel memberships. Similarly, it acquired FameBit in 2016 to help creators double their revenue.

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