On Thursday, Google’s parent, Alphabet, released better-than-expected quarterly results. During the 3rd quarter, the group reported revenues of $27.77bn, 24% higher than the $22.45bn recorded previously and easily beating expectations of $27.2bn. This uptick was mainly due to a higher-than-predicted surge in the volume of clicks on Google ads, especially in Asia. However, this increase was somewhat offset by higher traffic costs and a decline in the price of ads. Alphabet saw its adjusted earnings come in at $9.57 per share, sharply higher than forecasts of $8.33 per share and much better than a revised figure of $7.25 per share recorded in the previous corresponding period.
General Electric’s shares declined to their lowest level in 19 months on Friday, despite the group reporting better-than-expected results. The decline was mainly attributed to a 12% slump in revenue to $29.558bn, better than estimates of a decline to $29.015bn, but sharply lower than the $33.49bn recorded a year ago. Net profit for the period declined by 58% to $1.34bn, or 15 cents a share, much lower than the $3.30bn, or 36 cents a share, reported a year ago. On an adjusted basis, earnings declined to 28 cents per share, slightly higher than estimates of 25 cents per share, but sharply lower than the 51 cents per share recorded in the previous corresponding period.
On Tuesday, European Union (EU) antitrust regulators charged Alphabet’s Google with a record €2.42bn fine. This comes after the European Commission found that Google had given prominent placement in searches to its own shopping service, while demoting those of rival services. As a result, the European Commission ordered Google to stop this practice within 90 days or face a further penalty of up to 5% of Alphabet’s average daily global turnover. This outcome was only the first of three investigations into Google’s conduct, with the group also accused of using its Android operating system to destroy rivals as well as blocking rivals in online search advertising.
On Thursday, Alphabet shed 0.42% after the group released mixed quarterly results. Google’s parent company saw 4th quarter revenues come in at $26.06bn, slightly higher than expectations of $25.26bn. This topping of expectations was mainly due to its progressive monetising of YouTube and a strong performance from mobile search. However, the group did record a 16% decline in Google’s cost-per-click, which is the amount that it receives from advertisers, worse than expectations of an 11% drop. Alphabet posted adjusted earnings of $9.36 per share, worse than estimates of $9.64 per share, negatively affected by a tax charge.
On Thursday, Alphabet released its results for the fiscal 3rd quarter, with the group topping analysts’ estimates. For the quarter, the group saw revenue increase by 20% to $22.45bn, up from $18.68bn a year ago and better than expectations of an increase to $22.05bn. This sharp increase was mainly due to a strong performance in the group’s search and YouTube segments. In addition, Google’s websites saw sales increase by 23% to $16.09bn, while advertising revenues increased by 18% to $19.82bn. Alphabet reported adjusted 3rd quarter earnings of $9.06 per share, easily beating expectations of $8.63 per share.
On Monday, Alphabet, Google’s parent company, posted results that beat analysts’ estimates. For the 4th quarter, the group reported earnings of $8.67 per Class A share, above expectations of $8.10 per share and higher than $6.67 per share in the previous corresponding period. In addition, revenue came in at $21.33bn, above estimates of an increase to $20.77bn. Total sales increase by 18% from a year ago, driven by a 17% increase in advertising revenue. Boosted by the results, Alphabet climbed as much as 9% in after-hours trading, reaching a level at which it would surpass Apple as the most valuable company by market cap if it opened there during today’s session.
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Yesterday, Google surged 4.27% on news that it was restructuring the company. In a blog post, Larry Page revealed the company has decided to reorganize itself into a holding company called Alphabet, with the web address “adc.xyz.” Going forward, Google’s current search and advertising business will be held in a subsidiary under Alphabet, still called Google, while spinning off its more disparate interests into separate companies. This will enable the parent company to provide more autonomy and opportunity for a growing range of other interest including drones, self-driving cars and anti-aging research. Alphabet’s company structure will resemble Berkshire Hathaway’s, with each business, including Google, having its own CEO. They will in turn all report to Alphabet CEO, Larry Page.
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