Google’s Ad-Revenue Slowdown Likely To Be Cyclical And Not Secular


  • The digital advertising market is becoming more competitive, which is usually assumed to lead to lower overall industry profitability.
  • Disruption from new technology such as ChatGPT is always present, especially in the technology sector.
  • Alphabet could increase shareholder value by optimizing its balance sheet.
  • Alphabet’s ability to produce attractive returns on large amounts of incremental invested capital is one of its most enviable economic characteristics.
Man standing with hands pointing to information search is a data clicking to virtual internet search page computer touch screen

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Most Alphabet Inc. (NASDAQ:GOOG) (“Google”) investors were in for a rough awakening in 2022 (yours included) as the ad-tech behemoth shed roughly 40% of its market capitalization during the year (the stock has rebounded quite a bit since that). Your author

Disclosure: I/we have a beneficial long position in the shares of GOOG either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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