Are Alphabet’s Earnings Really That Bad?
Search engine behemoth Google reported second-quarter earnings per share of $10.13 and $38.30 billion in revenue. Consensus estimates called for $8.34 in EPS and $37.36 billion in revenue.
When Alphabet Inc. (NASDAQ: GOOG | GOOG Price Prediction) released its second-quarter financial results after the markets closed on Monday, the tech giant said that it had $10.13 in earnings per share (EPS) and $38.30 billion in revenue. That compared with consensus estimates of $8.34 in EPS and $37.36 billion in revenue, and the $14.21 per share and $38.94 billion reported in the same period of last year.
Revenues were driven this quarter by a gradual improvement of the company’s ad business and strong growth in the Google Cloud and Other Revenues.
The Google segment posted second-quarter revenues of $21.32 billion, down from $23.64 billion a year ago. YouTube ad revenues increased 5.8% year over year to $3.81 billion and Google Cloud increased 43.2% to $3.01 billion.
In the second quarter, year-over-year traffic acquisition costs paid to Google Network members decreased by 7.5%. Total traffic acquisition costs fell from $7.24 billion to $6.69 billion.
Alphabet did not offer any guidance in the report. However, the consensus estimates call for $10.75 in EPS and $41.52 billion in revenue for the third quarter.
The board of directors authorized the company to repurchase up to an additional $28.0 billion of its Class C stock. The repurchase timeline was not specified.
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On the books, cash, cash equivalents, and marketable securities totaled $121.08 billion at the end of the quarter, versus $119.68 billion at the end of the fiscal 2019 full year.
Shares of Alphabet closed Thursday at $1,531.45, in a 52-week range of $1,013.54 to $1,586.99. The consensus price target is $1,619.13. Following the announcement, the stock was relatively flat at $1,531.03 in the after-hours trading session.
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Chris Lange is a financial and geopolitical writer with more than a decade of experience covering a myriad of topics. He has published thousands of articles for 24/7 Wall St., with past coverage focused heavily on stocks, IPOs, healthcare, defense, global affairs, and technology.
His work has been quoted, or referenced by a number of outlets including Business Insider, USA Today, Yahoo Finance, MSN, The Motley Fool, and many other publications. A graduate of Southwestern University, he studied business with a focus on investments and has previous experience in banking and startups.
When not reading or writing the news, he is following his passion for Lacrosse, playing chess, or building solar projects with his dad.
