Alphabet Inc. (NASDAQ: NASDAQ:) reported second-quarter financial results Tuesday that were mostly above the analyst expectations.
Google stock was up 2.2% in after-hours trade Tuesday.
The company’s adjusted earnings per share (EPS) came in at $1.89, slightly higher than the consensus estimate of $1.83. Revenue for the quarter was $84.74 billion, also above the average analyst projection of $84.16 billion.
The top- and bottom-line earnings beat was primarily driven by the robust performance of Google’s Search and Cloud services.
The Cloud business notably exceeded $10 billion in quarterly revenues for the first time, contributing significantly to the overall revenue increase of 14% compared to the same quarter last year.
“Q2 results were not as convincing as in Q1, when beat was broader,” Jefferies analysts said in a note.
Operating income for Google Cloud reached $1.17 billion, surpassing estimates of $982.2 million and marking a milestone for the segment.
Alphabet’s CEO, Sundar Pichai, attributed the strong quarter to the “ongoing strength in Search and momentum in Cloud,” while emphasizing the company’s innovation in AI and infrastructure leadership.
Ruth Porat, President and CFO, highlighted the importance of investment in high-growth opportunities and the company’s commitment to re-engineering its cost base.
Google’s advertising revenue, which remains a significant part of its business, reported $64.62 billion against an estimate of $64.53 billion.
YouTube ads revenue, however, fell short of expectations at $8.66 billion compared to the estimated $8.95 billion.
Despite the slight shortfall in YouTube’s performance, the overall advertising and services sectors showed strength. Google Services revenue totaled $73.93 billion, slightly above the estimate of $73.58 billion.
The company’s operating margin was reported at 32%, marginally higher than the forecasted 31.8%.
Alphabet’s capital expenditures were $13.19 billion, exceeding the anticipated $12.23 billion, indicating ongoing investments in its core and emerging businesses.
The company’s workforce also expanded to 179,582 employees.
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#Alphabet #stock #adds #Google #Search #Cloud #fuel #earnings #beat #Investing.com