Google paid $1.65 billion in stock for YouTube in 2006. Two decades later, the platform anchors a roughly $93 billion annual business at Alphabet, leads the streaming industry in viewing hours, and keeps growing ad and subscription revenue at double-digit rates.
Google bought YouTube for $1.65 billion, all in stock, back in 2006, when Google's own market cap stood at just $130 billion. Alphabet became Google's parent company in a 2015 corporate restructuring, and YouTube is now the main driver of a nearly $93 billion business within it.
YouTube leads the shift to short-form video
According to research firm Nielsen, YouTube held 13.8% of streaming viewing hours in June, the largest share in the industry, ahead of second-place Netflix at 7.9%. The platform has also branched into live television through YouTube TV, an alternative to the traditional cable bundle.
Alphabet's most recent earnings report said 1.7 billion unique viewers worldwide watched World Cup videos on the platform this year. The shifts in the media landscape have been so significant that major long-form streaming platforms now frequently cite YouTube as a competitor.
Ad and subscription revenue keep climbing
In the first six months of this year, YouTube ads generated close to $21 billion in revenue, while the Google subscriptions, platforms, and devices line — which includes YouTube TV, YouTube Music and Premium, and NFL Sunday Ticket — brought in close to $25.3 billion. Together, that annualizes to close to $93 billion this year.
Both lines are still expanding: YouTube ads grew 12% year over year in the first half of 2026, while subscriptions, platforms, and devices grew 17%. According to Google Chief Business Officer Philipp Schindler, on Alphabet's most recent earnings call: "We continue to see a lot of momentum in the living room".
Alphabet shares (NASDAQ: GOOGL) traded up 1.77%, or $5.90, to $338.50.
An acquisition that keeps paying off
Spotting where media was headed before that future arrived took considerable due diligence, and some luck. Nearly two decades later, that $1.65 billion price tag looks small next to the business YouTube has become.
Source: The Motley Fool
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