Big YouTube miss yanks down Alphabet earnings and revenue

Google parent Alphabet on Tuesday reported its first quarterly revenue miss of the pandemic after the war in Ukraine hurt YouTube ad sales, leaving investors rattled as the global economy sputters.

The world’s largest provider of search and video made a fortune over the last two years as the pandemic forced more shops and people online. But outdoing those sales is proving difficult so far this year with the war, rising inflation and product shortages causing advertisers to dump marketing campaigns, according to analysts.

Alphabet shares, which were up nearly 90 per cent over the past two years, fell about 2.5 per cent after the results late on Tuesday. They had dropped 3.6 per cent during the regular session.

David Wagner, portfolio manager at Aptus Capital Advisors, voiced growing concerns about the macro environment. “Alphabet has been seen as one of the most insulated companies in the advertising space relative to peers, but sometimes you can still own the best house in the worst neighbourhood,” he said.

Alphabet said first-quarter sales rose to $68.01 billion, up 23 per cent from last year but below the average estimate of $68.1 billion among financial analysts tracked by Refinitiv, its first miss since the fourth quarter of 2019.