Alphabet CEO Sundar Pichai gestures during a session at the World Economic Forum annual meeting in Davos.
Fabrice Coffrini | AFP | Getty Images
Google parent-company Alphabet beat expectations for its second quarter earnings Thursday, marking its first revenue decline in the company’s history. The company’s stock fell slightly after hours.
Here’s how it did against Refinitiv consensus estimates:
- EPS: $10.13 (non-GAAP), vs. $8.21 estimated.
- Revenue: $38.30 billion vs. $37.37 billion estimated.
- YouTube advertising revenue: $3.81 billion vs. $3.78 billion, according to StreetAccount estimates
- Google Cloud revenue: $3.01 billion vs. $3.06 billion, as per StreetAccount
- Traffic acquisition costs (TAC): $6.69 billion vs. $6.67 billion, as per StreetAccount
Although the company reported its first annual revenue decline in history (a drop of 2%), the stock fell slightly after-hours.
As a result of the customer pullbacks amid the Covid-19 pandemic and the general maturing ad market, Alphabet itself cut marketing spending by half and instituted hiring freezes for the second half of the year in anticipation of a slowdown, CNBC reported. Around that time, Alphabet CEO Sundar Pichai said Google would be pulling back on some of its investments for the rest of the year amid the Covid-19 crisis, starting with hiring.
Revenue from “Other Bets,” which includes Alphabet’s self-driving car business Waymo as well as life sciences company Verily, fell to $148 million compared to $162 million in the same quarter the year prior. The Other Bets showed an operating loss of $1.11 billion during the quarter.
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