[ad_1]
Today, after the bell amid a deluge of earnings reports from big tech companies, Alphabet reported its own second quarter performance. The research and services company posted revenue of $ 61.9 billion as of June 30, 2021, net income of $ 18.5 billion, and earnings per share of $ 27.26. These figures correspond to revenue growth of 62% and net income expansion of 166%. Naturally, Google is currently being compared to the pandemic-affected Q2 2020 results, but its gains are notable nonetheless.
The Android maker’s results have beaten expectations, with Street only expecting Google’s parent company to post total revenue of $ 56 billion and earnings per share of $ 19.14. Notably, Alphabet shares rose about a percentage point after office hours, reflecting an equally muted market reaction to earnings results above Microsoft’s official forecast.
Alphabet is a company with a number of moving parts, so let’s unwrap the numbers a bit.
YouTube’s reported revenue of $ 7 billion is up 84% year-over-year. That sounds like a strong result, frankly, considering the age of YouTube. That said, yours truly wonders how much the ad load can increase on YouTube before a rival service steals some of its oxygen. In a separate note, YouTube revealed that its YouTube Shorts product had “surpassed 15 billion daily global views,” up 131% from the 6.5 billion daily global views it detailed in March. (Everyone wants to eat TikTok, it seems.)
Google Cloud reported revenue of $ 4.6 billion, up 54% year-on-year. This growth rate is slightly higher than what Microsoft published for its Azure cloud unit. However, since Microsoft’s effort is considered larger than Google’s in terms of revenue, investors could have anticipated greater growth than what Mountain View has just detailed. Google Cloud reduced its operating loss from $ 1.4 billion in the second quarter of last year to a much more modest deficit of $ 591 million in its last quarter. It’s frankly pretty good.
As for other bets, revenues have increased! But so are the losses. Alphabet’s skunkworks group had a turnover of $ 192 million, up from $ 148 million a year ago. But the trial and error collection lost $ 1.4 billion in the quarter, down from $ 1.1 billion for the corresponding period a year earlier.
Naturally with an operating profit of 19.4 billion dollars understood of its Other Bets cost center, Alphabet can well afford to continue to invest in projects likely to generate significant future revenues in the long term.
Still, everything at Alphabet that isn’t Google’s main offering (search, YouTube, etc.) lost money in the quarter:
Image credits: Alphabet
The real story, however, lies in the epic gains that Alphabet posted in Q2 2020 operating income through Q2 2021. Just look at this acceleration in operating income! This is a bit confusing result in terms of quality.
What else to note? Google’s share buyback program has been changed in part, but not in a way that should impact regular investors. So we can leave Alphabet’s quarterly content that the company was good enough to defend its market cap of just over $ 1.75 trillion, even though it failed to add too much to the figure. after-hours exchanges so far.
Now is the perfect time to be a big tech company.
Source link
