Alphabet dips as profits fall short in mixed Q1, despite broad revenue growth
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Alphabet (NASDAQ:GOOG) (NASDAQ:GOOGL) dipped postmarket Tuesday after a mixed quarter where it missed somewhat on profitability but with generally in-line revenues. GOOG is -4.1% postmarket; GOOGL is -3.8% after hours.
The company also authorized an additional $70 billion in stock repurchases.
Revenues rose 23% overall, to $68.01 billion, earned on the back of strong results in its Search and Cloud businesses, while YouTube growth fell a bit short of expectations, with ad revenue up just over 14%. In constant currency, revenues rose 26%.
Traffic Acquisition Costs rose to $12 billion from a year-ago $9.7 billion.
Operating income jumped 22% to $20.09 billion, with margin flat at 30%. With some added other expenses, though, net income dipped to $16.44 billion from a year-ago $17.93 billion.
Those headline profit numbers were hurt by an unusual swing in its "other income" category, where a year-ago gain on equity securities of $4.84 billion was replaced this year by a loss on equity securities of $1.07 billion.
The story from leadership was one of continued investment. "Weâll keep investing in great products and services, and creating opportunities for partners and local communities around the world," says CEO Sundar Pichai. "We continue to make considered investments in Capex, R&D and talent to support long-term value creation for all stakeholders," adds Chief Financial Officer Ruth Porat.
Revenue by segment: Google Search and other, $39.62 billion (up 24%); YouTube ads, $6.9 billion (up 14.4%); Google Network, $8.2 billion (up 20.2%); Google Other, $6.8 billion (up 4.9%); Google Cloud, $5.82 billion (up 43.8%); Other Bets, $440 million (up 122%).
Operating income by segment: Google Services, $22.9 billion (up 17.2%); Google Cloud, -$931 million (vs. year-ago -$974 million); Other Bets, -$1.16 billion (vs. year-ago -$1.15 billion).
Conference call to come at 5 p.m. ET.