YouTube surpasses $50 bn in revenue in last 4 quarters, says Google's Sundar Pichai

YouTube earns money from advertising sales and subscription services such as YouTube Premium and YouTube TV

YouTube's total revenue surpassed $50 billion for the first time in the past four quarters, Sundar Pichai, the chief executive of Google parent Alphabet, said on October 29.

The figure, which includes YouTube's ads and subscription income, underscores the rapid growth witnessed by the Google-owned video platform in recent years. It also means the service is now bigger than the streaming giant Netflix in revenue, which generated $37.6 billion over the past four quarters.

Google, which acquired YouTube in 2006 for $1.65 billion, typically does not report the overall revenues of YouTube each quarter, instead providing only the platform's advertising sales figures.

The income from YouTube's subscription services, including YouTube Premium and YouTube TV, is bundled with Google's broader subscriptions, platforms, and devices business. This segment also comprises revenues from the Pixel family of devices, app sales on Google Play, and subscription services such as Google One among other products and services.

The segment generated revenues of $10.7 billion for the third quarter of 2024, a 27.8 percent increase from $8.3 billion revenue in the same quarter last year.

During the company's earnings call, Pichai said that YouTube TV and YouTube Music Premium along with the NFL Sunday Ticket sports package that broadcasts National Football League (NFL) season games, are driving subscription growth for the platform. YouTube TV is a television streaming service available in the US.

Read: Sundar Pichai says more than 25% of Google's new code is generated by AI

In recent years, Google has also taken several steps to shore up YouTube's subscription revenue. The video platform launched a global initiative to crack down on ad blockers in October 2023, which it extended to third-party apps in April 2024, as part of its efforts to increase its subscriber base.

YouTube has also recently hiked the prices of its premium subscriptions across multiple countries, including India.

Revenues from YouTube's advertising sales have risen 12.2 percent to $8.9 billion for the quarter, from $7.95 billion a year back, driven by brand advertising, closely followed by direct response ads, Google's chief business officer Philipp Schindler said in the call.

Read: Alphabet’s pricey AI bet pays off with growth in Cloud, Search

YouTube's AI push

Schindler also mentioned that they are using artificial intelligence (AI) to improve recommendations on YouTube. "Driven by Gemini, our large language models have a deeper understanding of video content and viewers' preferences. As a result, they can recommend more relevant, fresher, and personalised content to the viewer" he said.

In September, Google announced that YouTube is integrating Google DeepMind's video AI model, Veo, into its short-form video feature, YouTube Shorts, to help creators generate video backgrounds and standalone clips.

During the call, Schindler stated that monetisation of Shorts continues to improve and close the gap with in-stream video, particularly in the US and other highly monetising markets.

"Of all the channels uploading to YouTube every month, 70 percent are uploading Shorts. We recently announced the ability to upload Shorts up to three minutes long," he said. Advertisers can also book the first position on Shorts blocks in nearly 40 markets.

Read: YouTube to offer more granular playback speed controls, collaborative playlists, and more

Pichai said that the tech giant is also leaning into the living room experience with multiview, along with an option for creators to organise content into episodes and seasons, similar to traditional television, a feature that was first announced in September.

"The number of creators making the majority of their YouTube revenue on TV screens is up more than 30 percent year-on-year," Schindler said.

During the 2024 Paris Summer Olympics, over 850 million unique viewers watched more than 40 billion minutes of content on the platform, resulting in 12 billion views, he said. More than 35 percent of the viewers watched it on their television screens.