Alphabet (GOOGL) reported weaker-than-expected earnings for the first quarter due to
declining advertising revenue on its YouTube platform.
The parent company of search engine Google reported earnings per share (EPS) of $24.62
U.S. compared to $25.91 U.S. that was expected on Wall Street, according to Refinitiv data.
Revenue in the quarter came in at $68.01 billion U.S. versus $68.11 billion U.S. that was
expected.
YouTube advertising revenue amounted to $6.87 billion U.S. compared to $7.51 billion U.S.
expected by analysts.
The YouTube video site was a beneficiary of the pandemic when users were at home on their
personal devices. Advertising revenue on the platform is now weakening and comes as rival
TikTok captures a growing share of the social media video market.
However, Google’s cloud business was a standout in Q1, growing 44% and beating estimates
as more big enterprises shift their workloads away from their own data centers. But the cloud
division is still losing money, reporting an operating loss of $931 million U.S., compared to $974
million U.S. a year earlier.
Alphabet’s “Other Bets” unit, which includes its life sciences companies and self-driving car unit
Waymo, nearly doubled revenue from a year earlier to $440 million U.S. from $198 million U.S.
Google also announced that its board of directors has approved a $70 billion U.S. share
repurchase program, which comes after the company announced a 20-for-1 stock split that is to
be executed in June of this year.
Year to date, Alphabet’s stock is down 18% at $2,373.00 U.S. per share.
