April 25 – Alphabet Inc (GOOGL.O) said on Tuesday that it would repurchase $70 billion in stock and reported first-quarter profit and revenue that exceeded expectations as demand for cloud services increased and ad sales held up better than expected.
Investors applauded the buyback proposal, pushing Google parent stock up as much as 4% in after-hours trading before paring gains to trade up 1.6%. Cloud service demand increased, while Google’s ad sales performed better than planned.
Excluding adjustments, Alphabet posted profits per share of $1.17, exceeding the $1.07 consensus forecast.
This quarter, Google outperformed both sales and earnings per share projections, but the grounds for investor optimism are modest,” said Insider Intelligence senior analyst Max Willens.
Profitability in cloud computing is “notable he says, but “the reality is that Google Cloud remains comfortably behind its two most important competitors, and its growth is slowing.” The unit’s sales increased by 28% to $7.41 billion.
Furthermore, advertisers, who account for the majority of Alphabet’s revenue, have reduced their expenditure in reaction to a consumer move back to in-store purchasing following the relaxation of masking and other restrictions. Marketers are experimenting with new platforms such as TikTok, which appeals to a younger demographic.
Meanwhile, the corporation has been trying to keep costs under control amid recession fears, and in January decided to reduce approximately 12,000 positions. On a conference call with investors, Chief Financial Officer Ruth Porat stated that capital expenditures this year would be “modestly higher” than in 2022.
On Tuesday’s call, she stated that Alphabet strives to “durably engineer our cost base” in order to invest in priorities such as cloud computing and artificial intelligence.
Alphabet’s Google business has been racing to catch up with rivals, most notably Microsoft Corp (MSFT.O), in developing new artificial-intelligence algorithms capable of generating long-form responses to questions and other cues. Microsoft invested $10 billion in OpenAI, whose ChatGPT software has been the focus of Silicon Valley since its free release in November.
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 said on Tuesday that it would repurchase $70 billion in stock and reported first-quarter profit and revenue that exceeded expectations as demand for cloud services increased and ad sales held up better than expected.){kind=link}