Google's Advertising Sales Miss Wall Street Expectations

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Google CEO Sundar Pichai

The internet giant collected $30.7 billion in ad revenue, short of the $32.6 billion that analysts had modeled.

Shares of Google parent Alphabet were falling 7 percent after the closing bell on Monday after the company posted smaller revenue than Wall Street had forecast due to less-than-expected advertising sales.

Overall, Alphabet posted an adjusted $29.5 billion in first-quarter revenue, shy of the $30 billion that was expected, though it logged $11.90 in per-share earnings while Wall Street had forecast $10.17 per share. Without adjustments for traffic acquisition, Alphabet's revenue was up 17 percent to $36.3 billion.

Google collected $30.7 billion in ad revenue, short of the $32.6 billion that Wall Street had modeled.

Google CEO Sundar Pichai boasted that Super Bowl ads viewed on YouTube soared 60 percent year over year and said the platform remains focused on taking down harmful and misleading videos.

YouTube Premium and YouTube Music are also experiencing strong growth worldwide as they are both introduced to various countries. The rate of YouTube clicks in general is growing, but not as fast as it had been previously, Nevertheless, YouTube is the key driver of click growth at Google.

Ruth Porat, the CFO of both Alphabet and Google, boasted of "robust growth led by mobile search, YouTube and Cloud."

Paid clicks on Google properties were up 39 percent, while the cost-per-click on Google was down 19 percent. Alphabet ended the quarter with 103,459 employees, up from 85,050 the year before. 

While shares of Alphabet were up $15.40 to $1,287.58 during the regular session, they were dropping more than $92 during the after-hours session.

Google's quarterly earnings are in contrast with many of its digital competitors, suggesting they may be taking some advertising from the search leader. Facebook, Snap, Amazon and Twitter each reported financial results last week that either matched or exceeded expectations.