Google Sales Bolstered by Retail Ad Increase

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Jan. 31 (Bloomberg) –- Bloomberg’s Ari Levy and Mark Crumpton discuss Google and Amazon earnings and what they mean for the industry as a whole in “On The Markets” on Bloomberg Television’s “Money Moves.” (Source: Bloomberg)

Telling us?

When you look at google, you're looking at a company that is benefiting tremendously from online advertising across the board.

We are coming out of the shopping period where all of the e-commerce taking place, those companies are advertising more and more.

That's a very clear picture.

A company puts an advertisement on google search, people click through that and go to buy their items.

It is profitable revenue for google, and google's numbers are up across the board.

Amazon, the revenue is up 20 plus percent from holiday sales.

That is not profitable for amazon.

While they are shipping a ton of product, they are paying for shipping.

For google you are seeing a good holiday quarter.

For amazon you are seeing a difficult holiday quarter.

Amazon did flex its muscle during a holiday shopping season.

How else do you explain the massive orders that disrupted america's largest delivery companies?

Amazon is striking all these agreements with shippers, whether usps or the postal service, to offer incentives for users to be certain they will get products in two days or get products on sunday.

Just because amazon makes those guarantees does not mean that the shippers can deliver.

Amazon does have to at least respond to the fact that people were getting items delivered late.

Both amazon and google, fourth-quarter results, they were tied to holiday spending.

The companies did not follow the same path in their strategies.

For google, any trends they can play into with online commerce shopping is a positive.

When you search for an item on google, you are expressing intent.

If you search for a watch, you probably want to buy that watch.

There are very few costs involved for google to deliver the results.

Amazon is involved in the transaction from start to finish and are responsible for making sure you get that low-margin product on time.

Amazon has huge costs involved with every purchase.

Google has virtually none.

Last week amazon hitting that all-time high.

Our investors overlooking week profit numbers?

A free ride for over a decade now to increase revenue at the expense of profit.

As long as that revenue number keeps going up, profitability numbers have not seem to matter.

Anytime profitability comes in below analysts' estimates, that is a problem and analysts wonder if that can continue.

Ari, thanks.

We're on the markets again in 30 minutes.

"street smart" is up next.

This text has been automatically generated. It may not be 100% accurate.

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