Alphabet Inc, Google’s parent company, reported $76.69 billion in sales for the third quarter of 2023, representing an 11% year-on-year increase, according to the group’s most recent earnings report.
According to The Times, despite the increase in revenue, the company’s share price fell 7% on Tuesday during trade.
However, the group’s share price increased by +1.61% by the end of Tuesday’s trading on the Nasdaq.
The initial drop in the share price during the trade is attributed to the group’s cloud business doing worse than analysts had anticipated.
The group’s financial performance, however, outperformed analysts’ expectations on practically every front during the reviewed quarter.
The company’s sales, which above the anticipated $75.97 billion, was $76.69 billion, and its earnings per share were $1.55 as opposed to the estimated $1.45.
In addition, YouTube’s ad revenue increased to $7.95 billion, exceeding estimates of $7.81 billion, while traffic acquisition costs came in at $12.64 billion as opposed to $12.63 billion.
The group’s revenue increase in the third quarter of 2023 was double digits year over year for the first time in more than a year. The performance of Google Search as well as the revenue from YouTube advertisements contributed to the revenue increase.
“I’m pleased with our financial results and our product momentum this quarter, with AI-driven innovations across Search, YouTube, Cloud, our Pixel devices, and more,” said the CEO of Alphabet, Sundar Pichai, in a speech to investors.
“There has been amazing progress and there is still much more to come as we continue to concentrate on making AI more beneficial for everyone.”
He also noted that YouTube Shorts, which competes with TikTok, currently receives 70 billion daily views, a huge increase from the 50 billion views registered at the beginning of 2023.
Key Highlights of Alphabet’s Q3 2023 vs Q3 2022 Performance
Revenue: $76.69 billion, +11%
Operating Income: $21.34 billion, +24.56%
Operating Margin: 28%, +300 basis points
Net income: $19.69 billion, +41.55%
Diluted Earnings per Share: $1.55, +46.23%
Google Advertising: $59.65 billion, +9.48%