Google’s holding company, Alphabet, has released its earnings report for the last quarter of 2021 and the whole year. It saw the advertising giant set new records revenue despite the challenges.
Alphabet reported $75.3 billion in revenue for the fourth quarter of 2021, a jump of 31 percent over the same period in 2021. The company took in a record $257 billion for the whole year, a 41 percent increase over the previous year. It was the first time the company earned over $200 billion in a single year, and it did so convincingly. The feat is remarkable because, just five years ago, Google made about one-third of what it has reported for the year.
Net income for the quarter was $20.6 billion compared to $15.6 billion for the same quarter in 2020. For the whole year, net income stood at $78.7 billion against $41.2 billion for the previous year.
The CEO of Google and Alphabet, Sundar Pichai, explained his company witnessed strong demand in its advertising business. The quarter was also massive for Pixel phone sales, setting another record. This was despite the update issues that plagued the newly released Pixel 6 series. However, we might never know exactly how the phone division performed because Google doesn’t release sales figures for the devices and other gadgets it sells. They are grouped under “Google other” under “Google Services.” “Google other” brought in $8.16 for the quarter under review.
The Cloud business grew strongly too. However, Google reported a $890 million loss for the segment on revenue of $5.54 billion.
Google’s advertising business, its mainstay, earned $61.24 billion during the quarter. This was despite Apple’s privacy settings changes that affected its ability to gather user data on the popular iOS devices. The new changes required users to opt into allowing being tracked within apps and on the websites that they visit. Google is not the only company affected by this new tracking policy, as big apps like Facebook, Twitter, Snapchat, and YouTube lost an estimated $10 billion in revenue in the second quarter alone.
However, Google is the least affected by Apple’s change because it gets its own user data through search traffic on its website and YouTube. Ad revenue from YouTube alone amounted to $8.63 billion in the holiday quarter.
The Other Bets segment earned $181 million. This includes businesses like Waymo and Verify.
Pichai said: “Our deep investment in AI technologies continues to drive extraordinary and helpful experiences for people and businesses across our most important products. Q4 saw ongoing strong growth in our advertising business, which helped millions of businesses thrive and find new customers, a quarterly sales record for our Pixel phones despite supply constraints, and our Cloud business continuing to grow strongly.”
Ruth Porat, CFO of Alphabet and Google, said: “Our fourth quarter revenues of $75 billion, up 32% year over year, reflected broad-based strength in advertiser spend and strong consumer online activity, as well as substantial ongoing revenue growth from Google Cloud. Our investments have helped us drive this growth by delivering the services that people, our partners and businesses need, and we continue to invest in long-term opportunities.”
Alphabet also announced a 20-for-1 stock split that will take effect in July.