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Alphabet Stock Declines Following Earnings, Revenue Miss

Published 10/25/2022, 04:19 PM
Updated 10/25/2022, 04:29 PM
© Reuters.  Alphabet (GOOGL) Stock Declines Following Earnings, Revenue Miss

© Reuters. Alphabet (GOOGL) Stock Declines Following Earnings, Revenue Miss

By Sam Boughedda

Google parent company Alphabet's (NASDAQ:GOOGL) shares fell more than 6.5% after-hours following the publication of its third-quarter earnings, which saw it miss profit and revenue estimates.

The tech giant reported earnings per share of $1.06, $0.22 below the analyst consensus estimate of $1.28, while revenue for the quarter came in at $69.09 billion compared to the consensus estimate of $71.34 billion.

At the time of writing, Alphabet shares are trading below the $100 per share mark at over $97.

The company said its results in the quarter were impacted by foreign exchange headwinds.

“Our third quarter revenues were $69.1 billion, up 6% versus last year or up 11% on a constant currency basis. Financial results for the third quarter reflect healthy fundamental growth in Search and momentum in Cloud, while affected by foreign exchange. We’re working to realign resources to fuel our highest growth priorities," said Ruth Porat, CFO of Alphabet and Google.

Google Cloud revenue came in at $6.87 billion, while Google Services revenue was $61.38 billion. In addition, YouTube ads revenue in the quarter was $7.07 billion, while traffic acquisition costs were $11.83 billion.

The company's number of employees increased to 186,779 from 150,028 in Q3 2021.

"We’re sharpening our focus on a clear set of product and business priorities. Product announcements we’ve made in just the past month alone have shown that very clearly, including significant improvements to both Search and Cloud, powered by AI, and new ways to monetize YouTube Shorts. We are focused on both investing responsibly for the long term and being responsive to the economic environment," commented Sundar Pichai, CEO of Alphabet and Google.

Latest comments

More manipulation, all lies.
All lies? Well, I guess that settles it.
Im not surprised. Although it's the market going to act like bad news is good news and think this is a signal that rates won't be risen any more ?
Nasdaq up. Economy still strong. Interest rates...up we go@
oh-oh
And this too shall pass!
Neftlix told us about the exchange problems their earnings were increíble bad but the market shrug it off. let's see with the big goog
Who making these expectations?? The one who made these estimates cannot even make this kinda profit, what credibility they have to make these over expected figures??
missing expectations that much and income collapsing. still expectations had been revised down alot just like most companies before the release
Stop over estimated the earnings especially when all these ibanks saying we are in recession, and keep over expect the numbers
well if you're paying 17x to 21x earnings you're going to have expectations on earnings to increase at a rate which matches that.  so that is where the estimate comes from.  when it misses it shows the multiple is too rich.   as the entire market is right now, far above the 10 year average multiple, so there will be a year or two down which will average the 10 years to the more reasonable levels than 2020-2021
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