Downbeat YouTube, Upbeat Spotify

Anyone looking for relief from the pall hanging over the advertising business didn’t find it in YouTube results Tuesday. The Alphabet-owned video sharing site, something of a bellwether for the creator economy, said YouTube’s ad revenue fell 2.6% to $6.7 billion during the first quarter compared with the same period a year ago. That was the third straight quarter of decline, and worse than the less-than-1% drop in Google’s total ad revenue. Executives blamed the economy and advertisers keeping a tight grip on their wallets—basically the same culprits that have led to a string of recent closures and layoffs in advertising-supported media businesses.

Executives highlighted where growth was happening, notably in TikTok rival Shorts. Alphabet CEO Sundar Pichai said the number of channels that uploaded to YouTube Shorts daily increased by 80% this quarter, and that channels new to posting Shorts saw the majority of new subscribers coming from those who see their Shorts content. “YouTube Shorts continue to see strong momentum with creators,” Pichai said on a webcast with investors.