Google advertising revenue rises 69% from last year

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Sundar Pichai, chief executive officer of Alphabet Inc., pauses during a discussion on artificial intelligence at the Bruegel European economic think tank in Brussels, Belgium, on Jan. 20, 2020. Pichai urged the U.S. and European Union to coordinate regulatory approaches on artificial intelligence, calling their alignment critical.
Geert Vanden Wijngaert | Bloomberg | Getty Images

Alphabet, the holding company whose main business is Google, is set to report Q2 2021 earnings after the bell Tuesday.

Analysts and investors say they’re expecting a strong surge in revenue compared with last year’s pandemic-stricken quarter, when the company saw its first ever annualized revenue decline.

Here’s what Wall Street expects according to analyst consensus:

  • Earnings Per Share (EPS): $19.34 per share, according to Refinitiv estimates.
  • Revenue: $56.16 billion, according to Refinitiv estimates.
  • YouTube advertising revenue: $6.37 billion, according to StreetAccount estimates.
  • Google Cloud revenue: $4.40 billion, according to StreetAccount estimates.
  • Traffic acquisition costs (TAC):  $9.74 billion, according to StreetAccount estimates.

YouTube ads are expected to be a strong point after near-50% growth last quarter, which would keep it on track to match the size of Netflix’s annualized revenue rate.

During the quarter, YouTube launched its TikTok competitor product Shorts as well as a $100 million fund to get popular people to use it. YouTube became the winner of the pandemic in terms of social media sites, according to a Pew report, which said the video platform saw usage grow from 73% of U.S. adults in 2019 to 81% in 2021.

During the quarter, Google also announced new e-commerce efforts, including a deeper partnership with Shopify that will let the company’s more than 1 million merchants make their products more discoverable in Google Search and elsewhere.

Regulatory threats and antitrust concerns against Google also reached a new high during the quarter.

The Biden administration announced it would appoint known Google foe Jonathan Kanter to lead its antitrust division. Biden also issued an executive order specifically ordering a crackdown on Big Tech and practices around data gathering and privacy. 

Earlier in July, French regulators fined Google $593 million over uncooperative behavior with news publishers. U.S. government enforcers in July filed its fourth antitrust lawsuit against Google in the last year. This time — a group of 37 state attorneys alleged the company abused its power over app developers through its Play Store on Android.

This is breaking news, please check back for updates.

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