Alphabet Beats Wall Street Forecasts And Increases Spending
Google parent company Alphabet (GOOGL) has issued second-quarter financial results that beat Wall Street forecasts on the top and bottom lines.
The search engine giant announced earnings per share (EPS) of $2.31 U.S., which topped estimates of $2.18 U.S.
Revenue in the April through June period came in at $96.43 billion U.S., which was ahead of the consensus expectation among analysts of $94 billion U.S.
Alphabet also topped several other key metrics for the company. These include YouTube advertising revenue of $9.79 billion U.S. versus $9.56 billion U.S. expected on Wall Street.
Google Cloud revenue, which analysts watch closely, came in at $13.62 billion U.S., which was ahead of consensus estimates of $13.11 billion U.S.
Despite the strong numbers, Alphabet’s stock dipped in after hours trading on news the company plans to increase its capital expenditures.
Management said that they will raise the company’s spending this year to $85 billion U.S., up from a previous projection of $75 billion U.S.
Alphabet has said that it needs to ramp-up its CapEx as it competes aggressively in the artificial intelligence (A.I.) sector.
The company’s search engine, while still dominant, faces growing threats from A.I. that’s being developed by rivals such as Microsoft (MSFT) and privately held OpenAI.
Prior to today (July 24), GOOGL stock was flat on the year (up 0.42%) and trading at $190.23 U.S. per share.
