YouTube ad revenue increased by 13% year-over-year to reach $9.8 billion in the second quarter of 2025, according to Alphabet’s Q2 2025 earnings report. This growth, up from $8.7 billion in the same period last year, slightly exceeded analyst expectations of $9.6 billion for the quarter.

The reported ad revenue of $9.8 billion represents approximately 10% of Alphabet’s total quarterly revenue of $96.4 billion. YouTube’s parent company reported overall revenue growth of 14% year-over-year.

“We continue to see strong performance in YouTube as well as subscription offerings,” said Sundar Pichai, CEO of Alphabet, in the earnings release. Google Services revenues, which include YouTube ads, increased 12% to $82.5 billion for the quarter.

The strong financial performance comes as Nielsen data shows YouTube has captured a record 12.8% of total TV usage in June, marking its fifth consecutive month at the top of Nielsen’s rankings.

Engagement and Audience 

According to management consulting firm Owl & Co, YouTube’s global engagement reached an estimated 835 billion hours in the first half of 2025, representing an 11% year-over-year increase. 

YouTube CEO Neal Mohan has noted that “TV screens have become the primary viewing medium for YouTube in the United States, with viewers watching over 1 billion hours of YouTube content on TVs daily.”

The platform’s audience composition is taking on new forms, with viewing from adults aged 65 and above nearly doubling over the past two years, increasing by 96% since February 2023. This demographic now represents 15.4% of YouTube’s audience, showing expansion beyond its traditional younger user base.

Streaming Advertising

In response to YouTube’s success in capturing TV viewing share, rival streaming services have increased their advertising strategies. HBO Max and Amazon Prime Video have ramped up ad placements to stimulate growth, while Netflix is emerging as a key competitor, particularly after announcing its intention to double advertising revenue within the year during its recent earnings call.

Nielsen data show that while YouTube dominates with a 12.8% TV viewing share, Disney maintains second place with 10.0%, while Netflix achieves a milestone by breaking into the top three media distributors for the first time with 8.3% of total television viewing in June.

Although Netflix has not publicly disclosed its ad revenue figures, an analyst from Madison & Wall estimates it at approximately $3 billion – significantly less than YouTube’s $9.8 billion for the quarter.

Revenue Performance and Monetization

Alphabet’s earnings report shows that YouTube’s ad revenue growth is part of a broader positive trend for the company. The Q2 results indicate that Google Services as a whole generated an operating income of $33.1 billion, up from $29.7 billion in the same quarter last year.

According to Owl & Co analysis, while YouTube leads in total viewing hours, Netflix maintains a higher Revenue Per Thousand Viewing Hours (RPMVH) – a key metric that measures how effectively platforms convert engagement into revenue. This difference highlights the distinct monetization approaches between the two platforms.

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