YouTube Ad Sales Soar 15% to $10.2 Billion as Alphabet Tops $100B Revenue
▼ Summary
– YouTube’s Q3 2025 advertising revenue was $10.26 billion, a 15% year-over-year increase that exceeded analyst forecasts.
– Alphabet reported overall Q3 revenue of $102.35 billion, up 16%, with net income rising 33% to $34.98 billion.
– YouTube Shorts now generates more revenue per watch hour than traditional in-stream videos in the U.S., though it remains a small portion of total video ad sales.
– Alphabet increased its 2025 capital expenditure forecast to $91-93 billion and expects a significant capex increase in 2026 due to company growth and Google Cloud demand.
– YouTube is reorganizing its product organization into three groups: Subscriptions Products, Viewer Products, and Creator & Community Products.
YouTube’s advertising business demonstrated remarkable strength, with sales climbing 15% to reach $10.26 billion in the third quarter of 2025. This impressive growth surpassed analyst expectations and contributed significantly to parent company Alphabet’s overall performance. The video platform remains a dominant force in digital advertising, continuing its pattern of strong double-digit expansion.
Alphabet itself celebrated a landmark quarter, surpassing $100 billion in total revenue for the first time. The company reported revenue of $102.35 billion, a 16% increase compared to the same period last year. Net income jumped an even more substantial 33% to $34.98 billion, resulting in earnings per share of $2.87. Google’s total advertising revenue, which includes YouTube, grew 12.6% to $74.18 billion.
Alphabet and Google CEO Sundar Pichai described the period as “terrific,” pointing to double-digit growth across all major business segments. He emphasized that artificial intelligence is now delivering tangible business results company-wide. For YouTube specifically, Pichai highlighted that the Shorts feature, its competitor to TikTok, is now generating more revenue per watch hour than traditional in-stream videos, even though Shorts still represents a smaller portion of overall video ad sales. He also noted the success of YouTube’s first-ever NFL game broadcast, which attracted over 19 million global viewers and set a new record for concurrent viewership on a YouTube livestream.
The company’s confidence is reflected in its revised capital expenditure forecast. Alphabet now anticipates 2025 capex to be between $91 billion and $93 billion, up from a previous estimate of $85 billion. Chief Financial Officer Anat Ashkenazi indicated that a “significant” increase in capital expenditures is expected for 2026, with more details to be provided during the next earnings call.
In a significant corporate development, Alphabet avoided a major regulatory disruption last month. A federal judge rejected a government proposal that would have forced Google to divest its Chrome browser, a remedy sought after the company lost an antitrust case. Instead, the ruling requires Google to share certain data with competitors and prohibits exclusive distribution agreements.
Internally, YouTube is undergoing a substantial reorganization of its product teams. Veteran executive Christian Oestlien now leads a newly formed Subscriptions Products group overseeing YouTube TV, Music, and Premium. Former Chief Product Officer Johanna Voolich will head the new Viewer Products team, and the company is actively seeking an executive to lead a third division focused on Creator & Community Products.
The platform has also introduced policy changes aimed at creators. YouTube recently began rolling out its “Second Chance” program, which allows some previously banned creators to request a new channel. This includes users who were terminated under now-retired policies concerning misinformation about the 2020 U.S. presidential election and COVID-19.
In a separate legal matter, Alphabet agreed in September to pay $24.5 million to settle a lawsuit filed by former President Donald Trump. The lawsuit alleged censorship after YouTube suspended his channel following the January 6, 2021, Capitol attack. Of the total settlement, $22 million was paid directly to Trump, who designated the funds for the construction of a new White House ballroom.
(Source: Variety)
