YouTube's shrinking ad business is an ominous sign for battered online ad market – CNBC

A YouTube logo seen at the YouTube Space LA in Playa Del Rey, Los Angeles, California, United States October 21, 2015.Lucy Nicholson | ReutersThe online advertising market continues to suffer, as heavyweights Alphabet and Microsoft reported disappointing sales during their most recent quarters.YouTube advertising revenue dropped 2% year over year to $7.07 billion during the Google parent’s third quarter, missing analysts’ estimates of $7.42 billion. It was the first time YouTube’s ad revenue shrank on a year-over-year basis since the company started breaking out the division’s results in 2019.Alphabet’s overall revenue growth drastically declined from 41% a year ago to 6%, underscoring how fears of a looming recession have caused companies to cut back on their advertising and marketing campaigns. Indeed, Chief Financial Officer Ruth Porat said during a call with analysts that YouTube’s revenue decline “primarily reflects further pullbacks in advertiser spends.”Some of the advertisers that slowed their online advertising spending with Alphabet come from the financial services, insurance, loans and mortgage and crypto industries, said Alphabet chief business officer Philipp Schindler.Last week, Snap set the tone for the online advertising market when it missed third-quarter analyst estimates with $1.13 billion in sales, sending its shares tumbling more than…
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