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Alphabet Inc (Nasdaq: GOOGL) just reported its best quarter for revenue growth in about two years. Shares of the tech titan are still down 5.0% in extended trading on Tuesday.
Why is Google stock down?
The stock is responding primarily to ad revenue that came in shy of Street estimates.
Google brought in $65.52 billion in ad revenue in its recently concluded quarter. Analysts, in comparison, were at $65.94 billion. Ruth Porat – its chief financial officer said in a press release today:
We remain committed to our work to durably re-engineer our cost base as we invest to support our growth opportunities.
Wall Street currently has a consensus “buy” rating on GOOGL.
Google Cloud did well in Q4
YouTube also printed just shy of Street estimates on Tuesday.
On the plus side, however, Google Cloud contributed $9.19 billion to the overall revenue the Nasdaq-listed firm generated in its fiscal Q4. That topped $8.94 billion that experts had forecast. According to CEO Pichai:
We’re pleased with ongoing strength in Search and growing contribution from YouTube and Cloud. Each of these is already benefitting from our AI investments and innovation.
GOOGL is still up 65% versus its 52-week low.
Google Q4 financial results
- Earned $20.7 billion versus the year-ago $13.6 billion
- Per-share earnings also climbed from $1.05 to $1.64
- Total revenue jumped 13% year-on-year to $86.3 billion
- Consensus was $1.59 a share on $85.33 billion in revenue
- $13.9 billion of traffic acquisition costs – less than expected
Alphabet Inc. launched Gemini in the fourth financial quarter – its most capable LLM to date as Invezz reported here. CEO Sundar Pichai also said on Tuesday:
As we enter the Gemini era, the best is yet to come.
🔥Breaking News from Arena
— lmsys.org (@lmsysorg) January 26, 2024
Google's Bard has just made a stunning leap, surpassing GPT-4 to the SECOND SPOT on the leaderboard! Big congrats to @Google for the remarkable achievement!
The race is heating up like never before! Super excited to see what's next for Bard + Gemini… pic.twitter.com/QPtsqZdJhC
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