Alphabet, owner of Google and YouTube, has said that sales increased by just 6% in the three months to September to $69 billion (£59 billion) as companies appear to have cut their advertising budgets.
This is the US brand’s weakest quarterly growth in almost a decade, excluding the beginning of Covid-19.
The news comes amid fears of a downturn in the economy.
Alphabet’s profits decreased by almost 30% to $13.9 billion (£11.9 billion) in the last quarter, with YouTube ad revenues declining for the first time since the company began to share them publicly. Overall all sales growth at the firm has reduced for the last five consecutive quarters.
Alphabet CEO Sundar Pichai has said that the company is “sharpening” its focus and “being responsive to the economic environment”.
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“When Google stumbles, it’s a bad omen for digital advertising at large,” Insider Intelligence principal analyst, Evelyn Mitchell, said.
“This disappointing quarter for Google signifies hard times ahead if market conditions continue to deteriorate.”
Google senior vice president and chief business officer Philipp Schindler told analysts: “On the second quarter earnings call, we noted a pullback in spend by some advertisers in YouTube and network, and these pullbacks in spend increased in the third quarter.
“In search and other, the largest factor in the deceleration in Q3 was lapping the outsized performance in 2021. In the third quarter, we did see a pullback in spend by some advertisers in certain areas and search ads.”
