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Google Shares Fall on Disappointing Earnings Report – By ASC


Alphabet, Inc., Google, Corporate Revenue – Pointing Points

  • Alphabet, Inc. recorded first quarter earnings per share of 24.62 on 56.02 billion revenue (ex-TAC)
  • Google shares (GOOG & GOOGL) rose in after -hours trading despite broader technology sales
  • YouTube’s advertising results and cloud growth disappointed investors, falling short of expectations

Alphabet Inc., Google’s parent company, reported mixed first-quarter corporate earnings following today’s closing bell. The tech juggernaut saw Q1 earnings per share (EPS) of $ 24.62 versus $ 25.71 expected. That’s at $ 56.02 billion in revenue (ex-TAC) compared to expectations of $ 56.07 billion, according to Bloomberg.

  • Alphabet Q1 Operating Margin: 30% vs. 28.8% budget
  • Alphabetical: S1 Operating Income: $ 20.09 bn vs. $ 19.7 bn

After -hours trading saw stock prices fall more than 5%, extending the 3.59% decline at the closing bell. The option price put the implied 1 -day movement at 8.33%. Investors are likely to be discouraged by weak cloud segment yields, which are seen as a key potential growth driver in the coming years. Google’s cloud services operating loss totaled $ 931 million, which exceeded the estimated loss of $ 893 million.

The Russian war in Ukraine has been a major factor in driving inflation problems around the world, prompting central banks to act more aggressively. That pushed many tech stocks, including Google, lower in the first quarter of this year. Google suspended services across Russia in response to its actions as well as complying with U.S. and EU sanctions.

YouTube’s advertising revenue – Google’s main growth driver – for the first quarter crossed the wire at $ 6.9 billion versus $ 7.5 billion expected. The weak stock price reaction is likely to drag the broader tech sector lower on Wednesday and throughout the rest of the week. Weak YouTube advertising numbers are likely due to changes in iPhone ad targeting.

Alphabet, Inc. (GOOGL) One Minute Chart

Charts made with TradingView

— Written by Thomas Westwater, Analyst for DailyFX.com

To contact Thomas, use the comments section below or @FxWestwater on Twitter

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