Google parent Alphabet Q4 results: shares down after earnings revenue beats estimates

Alphabet Blows Away Q4 Earnings Estimates Shares Fall

Alphabet Blows Away Q4 Earnings Estimates Shares Fall

San Francisco: Riding on Google's robust ad business, the parent company Alphabet has logged $39.3 billion in revenue for the fourth quarter of 2018 - an increase of 22 per cent from the same period a year ago. "That wasn't the case three years ago", when Greene launched the business unit, Pichai said. Amazon said its AWS revenues rose 45 percent, to $7.4 billion.

A run-up in spending has reflected Google's efforts to boost staffing on its cloud computing division, promote its consumer devices and YouTube subscription packages and acquire office buildings in Silicon Valley and NY.

The search giant's fourth-quarter revenue is expected to jump 21 percent to $31.3 billion as marketers spent more on Google ads to reach consumers online.

Heavy advertising in the run-up to the holiday shopping season boosted sales.

Google CEO Sundar Pichai didn't share any concrete sales numbers, but told investors during the company's earnings call on Monday afternoon that it had sold "millions" of devices during the quarter.

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Quarterly profit was $8.95 billion, or $12.77 per share, compared with a $3 billion loss a year ago.

Analysts had expected net income of $7.6 billion on revenue of $38.9 billion. An operating margin 3% lower than the 24% posted in Q4 2017 and higher expenditure are considered to be reasons for the drop-off, but Alphabet remains profitable. "But a lot of the additional expenditure is going into cloud where it is unclear whether there will ever be a return on that investment". The company is spending some of that on buying back an additional $12.5 billion of its Class C shares. The costs of its most ambitious projects also rose sharply. This year's earnings per share are expected to rise a modest 7% due in part to a comparison with 2018, which had almost $6 a share in equity gains. Despite strong Q4 2018 operating results, Google is having to contend with investors' fears its future revenues might decline on account of stiffer competition. But Alphabet gave away little new information on its other ventures on Monday.

Waymo is cautiously expanding a self-driving auto ride service in the Phoenix area with an eye toward eventually spreading to other cities and even branching out into autonomous deliveries, according to Porat. Why are investors feeling skittish about a company minting so much money quarter after quarter?

Alphabet's Google search engine is the digital world's most lucrative advertising business, and it was slapped with a $57 million fine last month by French authorities.

Google grew headcount to 98,771 at the end of the year, up from 80,110, with most of the growth coming in engineers and product mangers, and most of that in cloud.

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