Google India, Minting Money: Gross ad revenue grows to Rs 28,000 crore, up by 12.5%
In a recent disclosure of financial details obtained from the Registrar of Companies (RoC), Google India revealed a robust 12.49 per cent year-on-year growth in its gross ad revenue for the fiscal year 2022-23, reaching Rs 28,040 crore, as per a report by The Economic Times.
This further solidifies the tech giant’s dominant position in the digital advertising sector, driven by its key platforms such as Google Search, YouTube, and Chrome.
Comparing the figures with the previous fiscal year, Google India’s gross ad revenue witnessed a remarkable surge of nearly 80 per cent, climbing from Rs 13,886 crore in FY21 to Rs 24,926 crore in FY22.
Google India’s revenue structure comprises three primary segments: the resale of advertisement space, the sale of enterprise products, and the provision of IT and IT-enabled services to its group companies.
Despite a marginal decrease of 0.11 per cent, Google India’s operating revenue for FY23 settled at Rs 9,275 crore, down from Rs 9,286 crore in FY22. It’s worth noting that the company underwent a demerger of its IT services business into an independent entity known as Google IT Services India.
The National Company Law Tribunal approved the transfer of Google India’s IT business to Google IT Services India in May of the preceding year. This strategic move aimed to streamline Google India’s focus on its core business divisions of advertising and enterprise, enhancing operational efficiency.
The designated date for the transfer of Google India’s IT services business to Google IT Services India was April 1, 2021.
According to financial filings, Google India paid an equalisation levy of Rs 1,543 crore to the government for the acquisition of online advertisement space from Google Asia Pacific.
The company follows the practice of purchasing ad inventory from Google Asia Pacific and subsequently reselling it to advertisers within the country. In the previous fiscal year (FY22), Google India disbursed Rs 22,845 crore to Google Asia Pacific for ad inventory procurement.
In comparison, Google’s main competitor, Facebook Online India Services (the India arm of Meta), reported a 13 per cent growth in gross ad revenue, amounting to Rs 18,308 crore for FY23, up from Rs 16,189 crore in FY22.
A report by Magna Global, a media investment firm under IPG Mediabrands, indicates that the overall ad spend in India reached Rs 1,09,882 crore in 2023, marking an 11.8 per cent increase compared to the previous year. Notably, digital ad spending experienced a robust growth of 14.2 per cent, reaching Rs 49,883 crore.
Industry sources highlight the significant contribution of YouTube, boasting 573 million users, to Google India’s gross ad revenue. According to TAM Media CEO LV Krishnan, YouTube’s extensive reach and user engagement make it a pivotal player in attracting audiences and ad investments within the digital advertising market.
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