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GOOGL · Forward model · YouTube ads · Bull case

What has to happen in YouTube ads

Model as of

This page changes YouTube ads inside the complete GOOGL model. Every other vertical, corporate programme and valuation assumption stays in the selected portfolio case.

GOOGL forward model
Horizon
Consolidated fair value $519.16 all other verticals held in this portfolio case
Final-quarter revenue $22.46B 8% of company revenue
Explicit segment contribution $106.54B EBITDA less segment capex, before corporate items

Search keeps compounding on AI-driven queries, Cloud mix stays at the 35%+ operating margin, and the capex-to-revenue ratio starts falling before 2028. What this case does NOT reach is the $514B backlog converting on a numbered path — that is the named case — and it does not assume Waymo is a material P&L.

YouTube ads

Basis quarter$11.05B
Final quarter$22.46B
Implied CAGR+15%
Final revenue mix8%

Advertising on YouTube. $11,055M in the basis quarter, +13%. Direct response and brand, with living-room strength. Watch time is not a quarterly ARPU series, so the driver is sequential growth on the disclosed line.

Last four quarters
2025 Q3 $10.26B Reported
2025 Q4 $11.38B Reported
2026 Q1 $9.88B Reported
2026 Q2 $11.05B Reported
YouTube in-stream and Shorts adsYouTube TV advertisingDirect-response and brand
Sequential growth +3.0%/qtr decaying toward +1.5% Q2/Q1 was +12% on seasonality. 3% is about the +13% YoY, not a World Cup repeat.
YouTube ads

Latest: $22.46B (2031Q2E)

Period Value
2025Q1 $8.93B
2025Q2 $9.80B
2025Q3 $10.26B
2025Q4 $11.38B
2026Q1 $9.88B
2026Q2 $11.05B
2026Q3E $11.56B
2026Q4E $12.06B
2027Q1E $12.57B
2027Q2E $13.08B
2027Q3E $13.59B
2027Q4E $14.11B
2028Q1E $14.64B
2028Q2E $15.17B
2028Q3E $15.72B
2028Q4E $16.27B
2029Q1E $16.83B
2029Q2E $17.40B
2029Q3E $17.98B
2029Q4E $18.58B
2030Q1E $19.18B
2030Q2E $19.81B
2030Q3E $20.45B
2030Q4E $21.10B
2031Q1E $21.77B
2031Q2E $22.46B

Assumptions & reasoning

  • YouTube ads are not YouTube the franchise. Subscriptions sit on the other Services line. FY2025 YouTube ads-plus-subs exceeded $60B; that mix is not a vertical here.
  • Q2 included World Cup viewership (1.7B unique viewers in the CEO quote). Opening 3% does not assume another event of that size.
  • Same Services operating-income limitation as Search: 44% EBITDA is assumed because Alphabet does not split the P&L.
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