Alphabet reports better-than-expected quarterly profit and revenue
Google CEO Sundar Pichai speaks during the Google I/O keynote session at Shoreline Amphitheatre in Mountain View, California on May 7, 2019.
Josh Edelson | AFP | Getty Images
Alphabet reported profit and earnings for the third quarter that topped analysts’ estimates. The company’s shares were little changed after the report.
Here’s what the company reported versus what Wall Street expected:
Earnings per share (EPS): $27.99 per share vs $23.48 per share, according to Refinitiv estimates.Revenue: $65.12 billion vs. $63.34 billion, according to Refinitiv estimates.YouTube advertising revenue: $7.20 billion vs. $7.4 billion expected.Google Cloud revenue: $4.99 billion vs. $5.07 billion expected.Traffic acquisition costs (TAC): $11.50 vs. $11.16 billion expected.
Google’s advertising revenue rose 43% to $53.13 billion, up from $37.1 billion the same time last year and slightly higher than the prior quarter. YouTube ads rose to $7.21 billion, up from $5.04 billion a year ago.
Google appears to be managing through privacy changes that Apple made to iOS 14 earlier this year. Snap and Facebook both cited the change, which allows consumers to opt out of targeted ads on apps, as the main reason for business disruption during the period. Google is more protected than those companies because it owns the Android operating system.
Revenue in Google’s cloud division climbed 45% to $4.99 billion, while operating loss narrowed to $644 million from $1.21 billion. Alphabet has been investing heavily in the unit, which is led by former Oracle executive Thomas Kurian, in an effort to catch up to Amazon Web Service and Microsoft Azure.
Revenue in the Other Bets segment, which includes the self-driving car company Waymo, rose slightly to $182 million from $178 million. Losses widened to $1.29 billion from $1.1 billion a year earlier.
The company’s shares were little changed after the report. The stock is up 58% this year, more than double the gains in the S&P 500, as investors bet on the company’s ability to pick up business as the economy reopens and to withstand potential regulatory changes.
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