Alphabet released profitable financial results for the third quarter, which ended on the 30th of September. The company recorded $46.17 billion in total revenue, crushing Refinitiv estimates of $42.90 billion.
Google‘s parent company Alphabet Inc (NASDAQ: GOOGL) has announced gains in its earnings and revenue for Q3 2020. Following the announcement, the company’s stock jumped 9% in after-hours trading. On the 29th of October, Alphabet announced its earnings result for the third quarter, which ended on the 30th of September.
Beating analyst’s expectations, the multinational company recorded $16.40 earnings per share for the company. Analysts at Refinitiv had estimated that Alphabet would record $11.29 in the quarter. Also, Refinitiv analysts expected $42.90 billion in revenue. However, Alphabet crushed the analysts’ expectations to hit $46.17 billion in total revenue in the last quarter.
The CEO of Alphabet and Google Sundar Pichai commented on the recent achievements:
“We had a strong quarter, consistent with the broader online environment. It’s a testament to the deep investments we’ve made in AI and other technologies, to deliver services that people turn to for help, in moments big and small.”
The company’s chief financial officer Ruth Porat also commented on the recently-released financial results. Porat said that the nearly $46.2 total revenue gain in Q3 is led by a significant increase in “advertiser spend in Google Search and YouTube.” YouTube ad surged 32% year-on-year. In Q3 2019, Alphabet brought in $40,499 in total revenue.
Alphabet Surpasses Even More Analysts Expectations in Q3
According to a CNBC report, Porat revealed that since mid-March, YouTube views for guided meditation videos had climbed 40%. Alphabet executives said that YouTube has more than 30 million paid subscribers of YouTube Music Premium. Alphabet executives added that YouTube TV subscribers are over 3 million.
The CFO also said that the revenue gain is fueled by profits from Google Cloud and Google Play.
Alphabet reported a $3.44 billion gain in its Google Cloud business. The profit crushed StreetAccount’s prediction of $3.32 billion. Similarly, gains from YouTube ads hit $5.04 billion in the quarter, surpassing StreetAccount estimation of $4.39 billion.
Buttressing Pichai’s statement on Alphabet’s investment, Porat said:
“We [Alphabet] remain focused on making the right investments to support long term sustainable value.”
Furthermore, the result noted that Alphabet had expanded its team. Alphabet employees have increased from 114,096 in 2019 Q3 to 132,121 in the last quarter.
In the CNBC report, the CEO said that Alphabet would start giving more details on its financial results to investors, beginning from 2020 Q4. Specifically, Pichai said the company would start reporting income for its Google Cloud business separately. Speaking further, he said:
“With the segmentation, you will additionally see information about the scale of our investment, which will help gauge the progress we are making on the multi-year path ahead to create sustainable value.”
Currently trading at $1,646.40, Alphabet is up 5.75% over its previous close of $1,556.88. The multinational conglomerate has been surging over the past year. Alphabet has jumped 23.68% in the last twelve months and 16.24% in 2020. Also, the company climbed 1.20% in the last three months and gained 4.64% over the past month.
Despite recent significant increases, however, Alphabet has lost over 3% in the last five days.