Industry

Google s parent Alphabet beats expectations despite EU fine

FILE - In this July 25, 2017, file photo, Alphabet stock is shown on a screen at the Nasdaq MarketSite in New York. Shares in Google parent Alphabet jumped in after-hours trading Monday, July 23, 2018, as the company's second-quarter results exceeded Wall Street forecasts after taking into account a $5 billion charge levied by European regulators.

FILE - In this July 25, 2017, file photo, Alphabet stock is shown on a screen at the Nasdaq MarketSite in New York. Shares in Google parent Alphabet jumped in after-hours trading Monday, July 23, 2018, as the company's second-quarter results exceeded Wall Street forecasts after taking into account a $5 billion charge levied by European regulators.   | Photo Credit: AP

Taking the latest $5 billion fine by the European Commission into account, Google’s parent company Alphabet reported $26.24 billion in revenue for the quarter that ended on June 30, making a profit of $3.2 billion while beating Wall Street expectations.

Excluding the fine, the tech giant would have had $32.6 billion in revenue and a profit of $8.2 billion.

“We are analysing the decision and I think it’s too early to comment or speculate beyond what we’ve already said, but we will always take a constructive approach,” Google CEO Sundar Pichai said during the company’s earnings call with analysts late on Monday.

Riding on Search engine and YouTube growth, Google’s revenue jumped 26 per cent to $23.3 billion.

“We delivered another quarter of very strong performance, with revenues of $32.7 billion, up 26 per cent versus the second quarter of 2017 and 23 per cent on a constant currency basis,” Ruth Porat, CFO of Alphabet, said in a statement.

“Our investments are driving great experiences for users, strong results for advertisers, and new business opportunities for Google and Alphabet,” Ms. Porat added.

Traffic acquisition costs, a key metric in Google’s ad business, went up to 23% of ad revenue in the second quarter.

Last week, US President Donald Trump attacked the European Union (EU)for the fine slapped, and said: “The European Union just slapped a $5 billion fine on one of our great companies, Google,” Trump tweeted. “They truly have taken advantage of the US, but not for long!“

The European Commission fined Google for monopoly with its Android operating system, accusing it of violating the EU competition rules.

“I’m confident we find a way to make sure Android is available at scale to users everywhere,” Mr. Pichai said during the call with analysts.

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Printable version | Apr 3, 2020 11:57:40 PM | https://www.thehindu.com/business/Industry/google-s-parent-alphabet-beats-expectations-despite-eu-fine/article24502377.ece

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