Alphabet CEO Sundar Pichai gestures during a session at the World Economic Forum annual meeting in Davos.
Fabrice Coffrini | AFP | Getty Images
Google parent-company Alphabet beat expectations for its second quarter earnings Thursday, marking its first revenue decline in the company’s history. The company’s stock barely moved after hours.
Here’s how it did against Refinitiv consensus estimates:
- EPS: $10.13 (non-GAAP), vs. $8.21 estimated.
- Revenue: $38.30 billion vs. $37.37 billion estimated.
- YouTube advertising revenue: $3.81 billion vs. $3.78 billion, according to StreetAccount estimates
- Google Cloud revenue: $3.01 billion vs. $3.06 billion, as per StreetAccount
- Traffic acquisition costs (TAC): $6.69 billion vs. $6.67 billion, as per StreetAccount
The company’s board also authorized the company to repurchase up to $28 billion of its Class C shares.
CFO Ruth Porat said on an earnings call that consumers returned to more “commercial” search queries toward the end of the quarter, and advertisers began increasing their search spending, so search revenue ended the quarter about even from last year.
As a result of the customer pullbacks amid the Covid-19 pandemic and the general maturing ad market, Alphabet itself cut marketing spending by half and instituted hiring freezes for the second half of the year in anticipation of a slowdown, CNBC reported. Around that time, Alphabet CEO Sundar Pichai said Google would be pulling back on some of its investments for the rest of the year amid the Covid-19 crisis, starting with hiring.
Although Porat said growth improved toward the end of the quarter, she cautioned that it’s hard to gauge whether those trends will continue. “We believe it is premature to gauge the durability of recent trends, given the obvious uncertainty of the global macro environment,” she said.
Google’s “other revenue,” which includes hardware like its Pixel phones, came in at $5.12 billion, compared to $4.08 billion in the same quarter a year ago.
Revenue from “Other Bets,” which includes Alphabet’s self-driving car business Waymo as well as life sciences company Verily, fell to $148 million compared to $162 million in the same quarter the year prior. The Other Bets showed an operating loss of $1.11 billion during the quarter.
Alphabet added approximately 4,000 new employees to a full-time workforce of 127,498 during the second quarter. That doesn’t include contractors. Porat said that the company will continue to decelerate year-over-year headcount growth.
Google is also facing antitrust probes along the same lines by the Department of Justice and 50 attorneys general investigating Google company’s search and Android businesses. That is expected to result in legal action that could span issues ranging from its search product to digital advertising marketplace, according to a recent report from The Wall Street Journal.
When analysts asked about this on the call, CEO Sundar Pichai said “I think the scrutiny is going to be here for a while.” He added that the company will “adapt.”
This is breaking news. Please check back for updates.
WHAT DO YOU THINK?- We have all sinned and deserve God's judgment. God, the Father, sent His only Son to satisfy that judgment for those who believe in Him. Jesus, the creator and eternal Son of God, who lived a sinless life, loves us so much that He died for our sins, taking the punishment that we deserve, was buried, and rose from the dead according to the Bible. If you truly believe and trust this in your heart, receiving Jesus alone as your Savior, declaring, "Jesus is Lord," you will be saved from judgment and spend eternity with God in heaven.
What is your response?
If you are not a Christian, and would like to become a Christian. Simply say - "LORD Jesus, thank you for forgiving me of my SINs, today I am deciding to follow you. Accept me into your family, in Jesus name I pray. Amen "
If you still have questions , click here to Contact Us, we are here to help
Unless otherwise specified, the news and opinions expressed are solely the source's and author's and do not necessarily reflect the views of The Christian Mail.