Google parent Alphabet Inc's quarterly revenue growth of 23% reflect increases in advertiser spending in Search and YouTube within Google Services, as well as "ongoing strength" in Google Cloud, chief financial executive Ruth Porat said in an earnings call on Tuesday. The Services segment saw significant recovery from the impact of COVID-19, driven by Search, YouTube, and network advertising. Recovery can be credited to the broader shifting of activities online and advertisers reactivating spend that had been put on hold in the earlier months. In Q4, retail was the largest contributor to the year-on-year growth of the ads business. Tech, media and entertainment and consumer packaged goods were also strong contributors. In Q4, growth rates in retail searches was 3x of last year. Google’s merchant community grew over 80% in the past year, with “significant growth in small and medium-sized businesses”. Increase in cost of revenue by 24% to $26.1 billion was driven by ‘Other cost of revenue’ of over $15 billion. This, in turn, was driven by: Content acquisition costs, primarily driven by costs for YouTube's advertising-supported content, followed by costs for subscription content; Costs associated with data centers and other operations, including depreciation. Ad spend recovers on YouTube, growth in Shorts, Premium subscribers YouTube's Direct Response ad format saw substantial growth throughout the year, including in Q4. Brand spending began to recover in Q3 from pull back in the initial months due to the pandemic, with marketers realising the need to keep brand recall intact even if consumer…
