Tech

YouTube says it paid the music industry more than $3 billion last year

Key Points
  • In a blog post, YouTube CEO Susan Wojcicki said more than $3 billion of the company's ad revenue went to the music industry.
  • The latest figure hints at how much of the Alphabet-owned company's ad revenue goes back to music industry and creators.
  • The company for the first time broke out ad revenue numbers in its fourth quarter earlier this month.
Susan Wojcicki, CEO of YouTube.
Michael Newberg | CNBC

YouTube says it paid the music industry more than $3 billion last year.

"YouTube offers twin engines for revenue with advertising and subscribers, paying out more than $3 billion to the music industry last year from ads and subscriptions," YouTube CEO Susan Wojcicki said in a blog post Friday.

The latest figure hints at how much of the Alphabet-owned company's ad revenue goes back to music industry and creators. The data has been largely unknown to investors who have wondered how much money the company is actually pocketing at the end of the day.

YouTube broke out ad revenue numbers for the first time in its fourth quarter earlier this month.

YouTube ads generated $15.15 billion in revenue in fiscal 2019, with $4.72 billion generated in the fourth quarter alone. However, the segment didn't include YouTube's non-advertising revenue, like subscriptions for YouTube TV, which are included in Google's "other" revenue segment.

While the new disclosures pleased analysts, some said they didn't get the key points stakeholders still want. For example, Alphabet CFO Ruth Porat said on the company's earnings call Monday that the majority of YouTube's ad revenue goes back to the creators, but she declined to give any specifics. Some analysts questioned YouTube's profitability.

Alphabet's shares dipped nearly 5% after it missed Q4 revenue expectations earlier this month, amid ad growth deceleration.

In Friday's blog post, which marked YouTube's 15th birthday, Wojcicki said one goal for 2020 is to deepen the company's partnership with the music industry, media companies, creators and advertisers.

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