Alphabet beats revenue estimates buoyed by cloud and YouTube

Andrew Cummings
July 31, 2020

Alphabet's overall second-quarter revenue was $38.3 billion, down 2% from the same time past year.

Google parent Alphabet's quarterly sales fell for the first time in its 16 years as a public company, but the 2% slide was less than expected as many advertisers stuck with the world's most popular online search engine during the pandemic.

For Q2, YouTube's ad revenue was $3.81 billion, up from $3.60 billion in the year-ago period.

Cloud revenue was $3 billion, up 43% from the same quarter past year, the Mountain View, California-based company said in a statement.

Competition regulators across the Americas, Europe and Asia are weighing whether Google has stifled competition on its way to dominating search, mobile software and other businesses, with some bodies even considering forcing it divest parts of its ad operations.

Alphabet overall posted $38.30 billion in revenue (down 2%) while net income of $6.96 billion (or $10.13 per share) represented a 43% year-over-year decline.

Still, revenue was higher than the $37.4 billion Wall Street analysts had expected.

"As people increasingly turn to online services, our platforms - from Cloud to Google Play to YouTube - are helping our partners provide important services and support their businesses", Pichai said. They closed at $1,538.37 in NY.

"We saw a gradual return in user search activity to more commercial topics throughout the quarter, followed by an increase in spending by advertisers", she said. Ad sales improved near the end of the quarter.

Google shares, which have gained 15% this year, rose about 0.5% in extended trading following the report. "This also reflects the slower pace of ground-up construction for both our office facilities and data centers due to COVID-19". That's the lowest they've been since the third quarter of 2018 and the first-ever decline.

Spending and hiring will continue for the cloud business, Porat said.

Presently, Google is facing antitrust probes along with the other Big Tech companies like Apple, Amazon, and Facebook. Having said that, obviously we will operate based on the rules. "I think the scrutiny is going to be here for a while, and so we are committed to working through it". The market expected worse, however, and Google's share price is now up half a percent in after-hours trading.

Other reports by iNewsToday