By
Godfrey Benjamin
April 18th, 2024
Alphabet is known for heavy spending across its various business units, and the Q3 results were a reflection that these investments are yielding the desired results.
Google’s parent company, Alphabet Inc (NASDAQ: GOOGL) has released its third-quarter (Q3) results that topped analysts’ expectations in many aspects. According to what the company reported, advertising revenue came in at $53.13 billion, up 43% from $37.1 billion the same time last year and with a mild increment from the second-quarter result.
The total revenue from all of its ventures came in at $65.12 billion while Refinitiv analysts projected the figure to crest at $63.34 billion. Google’s YouTube advertising revenue came in at $7.20 billion against the projected expectation of $7.4 billion. Earnings Per Share (EPS) for the quarter was pegged at $27.99 per share analyst’s expectations of $23.48 per share. While Google Cloud’s revenue came in at $4.99 billion, the company incurred $11.50 billion in Traffic Acquisition Costs (TAC) for the quarter.
Central to the impressive performance is the right positioning of the Mountain View, California-based company, to become relevant to firms even as the adjustments to the impact of COVID-19 continue.
“Five years ago, I laid out our vision to become an AI-first company. This quarter’s results show how our investments there are enabling us to build more helpful products for people and our partners,” said Sundar Pichai, CEO of Alphabet and Google, “Ongoing improvements to Search, and the new Pixel 6, are great examples. And as the digital transformation and shift to hybrid work continue, our Cloud services are helping organizations collaborate and stay secure.”
Despite the massive growth in revenue, Alphabet said the changes to privacy features introduced by Apple Inc (NASDAQ: AAPL) earlier in the year impacted its business as well as other firms that rely on ad revenues. While the Apple changes had a “modest impact on YouTube revenues,” according to Alphabet’s CFO, Ruth Porat, the company was able to cushion the impact as it has its own Play Store.
Alphabet Q3 Results: Bolstered by Investments in Long Term Growth
Alphabet is known for heavy spending across its various business units, and the Q3 results were a reflection that these investments are yielding the desired results.
“Our consistent investments to support long-term growth are reflected in strong financial performance, with revenues of $65.1 billion in the quarter. We continued to deliver across our business by providing helpful and valuable experiences for both consumers and our partners,” Porat said.
The company has in particular been making heavy investments in its Cloud infrastructure so as to compete with competitors including Microsoft Azure, and Amazon Web Services. Google’s Chief Business Officer, Philipp Schindler also pointed out that retail consumers were the biggest contributors to the ad revenues when compared with the year-ago period.
Despite the better than expected earnings report, Alphabet shares slipped by 0.92% in the Pre-Market paring off the gains recorded in its Tuesday trading session. The company’s shares were pegged at $2,760.46 at the time of writing.