The earnings of Google parent Alphabet Inc. are slowing down in part due to problems associated with the crypto bear market.
According to the search engine giant’s parent company, a decline in the purchase of online ads from businesses in the financial sector, including crypto companies, lowered earnings in the third quarter.
Philipp Schindler, Google’s chief business officer, said during an earnings call that there was a pullback in online ad purchases by crypto companies, among others.
“And as I said earlier, in Search and other ads revenues, while lapping the outsized performance was the largest factor in Q3, we did see some advertiser pullback in certain areas in search ads. And I think the example I called out was in financial services, in the areas of insurance, loan, mortgage, and crypto subcategories. And we also noted a pullback in spending by some advertisers on YouTube and Network. And these pullbacks in spending increased in the third quarter. And we also noted lower revenues from AppPromo spend on YouTube and Network.”
Schindler did not provide additional details on the decline in crypto ads. Bitcoin (BTC) and other digital assets reached all-time highs in late 2021 before collapsing along with other risk assets amid troubling macro conditions.
Alphabet reported $69.1 billion for its third-quarter revenues. While that was a growth of 6%, it was much lower than the 41% revenue growth last year and it is reportedly the least growth since 2013, except for the second quarter at the start of the COVID-19 pandemic in 2020. Overall ad revenue totaled $54.5 billion for the quarter, up just 2.5%.
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