Google CEO Sundar Pichai testifies before the House Judiciary Committee at the Rayburn House Office Building in Washington, D.C., on Dec. 11, 2018.
Alex Wong | Getty Images
Alphabet, the parent company of Google and YouTube, reported stronger-than-expected first-quarter growth on Thursday after the bell. Shares rose 4% in after-hours trading.
Here’s how the company did, compared with estimates from analysts polled by LSEG:
- Revenue: $90.23 billion vs. $89.12 billion, estimated
- Earnings per share: $2.81 vs. $2.01, estimated
Wall Street is also watching several other numbers in the report:
- YouTube advertising revenue: $8.93 billion versus $8.97 billion, according to StreetAccount
- Google Cloud revenue: $12.26 billion $12.27 billion, according to StreetAccount
- Traffic acquisition costs (TAC): $13.75 billion versus $13.66 billion, according to StreetAccount
Alphabet’s search and advertising units are still showing strong growth despite AI competition heating up, according to its first-quarter earnings report.
Alphabet’s overall revenue grew 12% year-over-year, higher than the 10% Wall Street expected.
Google’s YouTube advertising revenue came in just short of analyst expectations at $8.93 billion. Overall advertising brought in $66.89 billion, up 8.5% from the year prior.
Google reported revenue of $12.26 billion for its cloud computing business, which was slightly below analysts’ expectations of $12.27 billion, according to StreetAccount. But the cloud unit saw its revenue increase 28% year-over-year, and its margins came in at 17.8%, compared to 9.4% a year ago.
Google’s “Search and other” segment reported $50.7 billion — up 9.8% from $46.16 billion a year prior. Alphabet said AI Overviews, its AI tool placed at the top of Google’s search results page, now has 1.5 billion users per month, up from 1 billion in October.
Alphabet’s net income increased 46% to $34.54 billion, or $2.81 a share, from $23.66 billion, or $1.89 a share, a year earlier. The company said that included $8 billion in unrealized gains on its non-marketable equity securities related to Alphabet’s investment in a private company.
The company said its “Other Bets” segment, which includes its self-driving car unit Waymo and life sciences unit Verily, brought in $450 million, down 9% from $495 million a year earlier. The unit lost $1.23 billion — up from $1.02 billion the year prior.
Alphabet also said that its board authorized it to repurchase an additional $70 billion in shares, just as it did a year ago.
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