Google Summer Ad Business Falls After Crypto Winter

Q3 advertising struggled, partly due to a pullback in spending from crypto companies, Google’s Chief Business Officer Philipp Schindler said

article-image

Source: Shutterstock

share

key takeaways

  • Google’s quarterly ad revenue dropped 2% to $7.1 billion as advertisers slashed budgets
  • YouTube ad revenue fell for the first time since the division began reporting performance in 2020

Internet giant Google is seeing some financial pain as advertisers, including crypto firms, pull back on their spending alongside rising inflation.

Parent company Alphabet on Tuesday posted its third-quarter earnings — a quarterly net profit of $13.9 billion — down 27% from a year ago, missing analyst estimates of $16.9 billion. Revenue climbed 6% to $69.1 billion, falling short of the $71 billion expectation.

The Mountain View, California-based company appears to have been affected by the crypto winter, rising interest rates and fears of slowing growth as the global economy is still reeling from the pandemic and Russia’s war in Ukraine.

Philipp Schindler, Google’s chief business officer, said in the earnings call that the slump was driven in part by crypto companies and other financial firms trimming ad spending.

“In the third quarter, we did see a pullback in spend by some advertisers in certain areas and search ads,”  he said. “For example, in financial services, we saw a pullback in the insurance, loan, mortgage and crypto subcategories.”

Schindler didn’t elaborate on which crypto subcategories contributed to the slide, but the company’s strict crypto ads policy is designed to shut out shady advertising or brazen scams. 

Google didn’t return Blockworks’ request for comment by press time.

Google’s advertising revenue from YouTube fell 2% to $7.1 billion, the first time the division reported a loss. Meanwhile, revenue from Google search ads rose 4.2% to $39.5 billion, but but the division missed forecasts for 8% growth.

Alphabet CEO Sundar Pichai described the period as a “tough time in the ad market,” and Chief Financial Officer Ruth Porat blamed the year-on-year slump on “further pullbacks in advertiser spend.”

The cryptocurrency market has trended downward this year, hit by a mix of recessionary fears and the collapse of the Terra ecosystem, with 2021 darling assets such as Solana down over 90% year to date. Price volatility forced major industry players including Coinbase, Blockchain.com and BlockFi to rejig operations and lay off thousands of employees. 

Pay-per-click (PPC) marketing is generally not what Web3 businesses do, and not what they have historically been doing, according to Adrian Krion, founder and CEO of blockchain gaming startup Spielworks.

“Right now, [lower ad spending] is also related to the low interest and the bear market,” he told Blockworks, adding that businesses in the industry are expected to rely on proven practices like content and viral marketing until Google’s financial product and services policy is made clearer.

Google bets on Coinbase for revenue diversification

Despite the bearish sentiment, the crypto winter is not broadly seen as a terrible thing for the industry as a whole, as times of slow growth are helpful in rooting out conceptually weak projects and carving out space for others to innovate.

Google appears to accept that the drawdown in revenue from crypto-related advertisers won’t last long. Earlier this month, it inked a deal with Coinbase to soon begin accepting crypto payments from its cloud customers.

Lars Seier Christensen, chair of Concordium and founder of Saxo Bank, said Google’s new partnership is a “general endorsement of the crypto space” where an increasing number of businesses accept crypto as viable tender for goods and services. 

“But more importantly, it’s unquestionable that Google has done this to gain additional market share for its growing cloud business. This means that Google has recognized a real business potential in the equally growing number of crypto native businesses,” he added.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Decoding crypto and the markets. Daily, with Byron Gilliam.

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

Industry City | Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

Brooklyn, NY

SUN - MON, JUN. 22 - 23, 2025

Blockworks and Cracked Labs are teaming up for the third installment of the Permissionless Hackathon, happening June 22–23, 2025 in Brooklyn, NY. This is a 36-hour IRL builder sprint where developers, designers, and creatives ship real projects solving real problems across […]

recent research

Research Report Templates (19).png

Research

Suilend has grown into the top money market and liquid staking provider on Sui. STEAMM, Suilend’s Superfluid AMM, presents a compelling avenue for growing market share within Sui’s DEX landscape and revenue generation for the protocol. Suilend’s multi-product suite position it well for owning market share across key verticals. While current metrics across the Sui ecosystem are likely inflated due to Sui Foundation incentive programs, SEND trades at amongst the lowest multiples in the lend/borrow sector, suggesting that a bull case for continued growth in the ecosystem may be mispriced.

article-image

Strive board member Ben Werkman expects thousands of firms to hold BTC, if only “to protect themselves”

article-image

To date, 12.6 million humans have scanned at a World Orb

article-image

One small step for man, one giant leap for Bitcoin

article-image

Jay Woods, Chief Global Strategist at Freedom Capital Markets, said it would be “very rare” for an acquisition to happen since the IPO may occur as soon as next week

article-image

Sponsored

Money is one of the most consequential pieces of infrastructure, and M0 believes its architecture should serve builders, not extract from them

article-image

The financial backwaters they laughed at might be the only thing keeping the dollar afloat