Google stock up 5 percent after pulverizing earnings expectations

24 July, 2018, 21:36 | Author: Kevin Carter
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In the same quarter a year ago, Alphabet reported earnings of $8.90 per share, excluding a $2.7 billion regulatory fine the European Union imposed on the tech giant.

Google properties revenue jumped 26 percent to $23.3 billion.

Shares of Google were up significantly after hours, rising 5 percent immediately after the numbers were released.

The future of the Android mobile operating system - which powers more than 85% of smartphones - has been clouded by the European Union action, which could forceGoogleto change its business arrangements with device makers. With the regulatory issue settled, they said, Google could get back to focusing on selling ads across the internet.

Net income came in at $US3.2 billion, down from $US3.5 billion in the same quarter of 2017, largely due to the European fine. Spending on Google Shopping search ads, which let marketers promote consumer products, increased 31 percent in the second quarter from a year earlier, according to data from digital marketing firm Merkle; those gains came even as Amazon revs up its own ads business.

Business Insider has contacted Google for comment.

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For a company that was just hit with staggering $5 billion fine, Google and parent company Alphabet are as unbothered as ever.

"I think overall it [Android] has created more choice for everyone, not less", Pichai said during the call, when asked about the European Union decision. Google is appealing the ruling. Alphabet has said it will appeal the order.

Macquarie Group senior analyst Benjamin Schachter wrote in a report this month that "we are approaching a point where we (and we believe The Street collectively) are not understanding the size of search vs YouTube vs programmatic, which may lead to increasing volatility" in share price. The company's other revenue bucket, which includes cloud, hardware and app sales, grew 37 per cent to US$4.4 billion in the second quarter.

"We're pleased with the ongoing momentum in our advertising businesses", said Porat on a conference call for investors, adding that Alphlabet has high hopes for the positive impact of machine learning on its ad business.

Revenue in Alphabet's "moonshot" Other Bets category came in at $145 million with operating losses rising to $732 million.

"Alphabet also breaks out the revenues and losses for its 'Other Bets, ' like healthcare company Verily, internet service provider Fiber, and self-driving vehicle company Waymo".

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