Alphabet reports Q4 results: ‘narrative at Google is powerful’

Shares of Alphabet Inc (NASDAQ: GOOGL) jumped roughly 9.0% in extended trading after the tech giant reported better-than-expected results for its fiscal fourth quarter.

What the earnings report tells us?

Alphabet said its net income printed at $20.64 billion ($30.69 a share) versus the year-ago figure of $15.28 billion ($22.30 a share). At $75.3 billion, revenue noted a 32% annualised growth, as per the earnings press release.

According to Refinitiv, experts had forecast $27.34 and $72.17 billion in EPS and revenue, respectively. Cloud revenue was up 45% – ahead of the FactSet consensus. Advertising revenue jumped 33%, with $8.63 billion coming from YouTube versus a higher $8.87 billion expected.

Traffic acquisition costs (TAC) climbed to $13.43 billion from last year’s $12.84 billion. Operating margin moved up from 28% in the comparable quarter of fiscal 2020 to 29% in Q4. Also on Tuesday, the American multinational announced a 20-for-1 stock split, expected to take effect in July. Shares are now up 2.0% for the year.

Crockett reacts to Alphabet’s quarterly results

Applauding Alphabet’s strong performance in Q4 on CNBC’s “Closing Bell”, DCFStocks’ Barton Crockett said:

The narrative at Google is incredibly powerful. It’s well-positioned for what’s working right now. Nobody in large-cap is more insulated to Apple’s privacy moves. With the type of growth we’re looking at, in the next year or two, they very quickly be at a market multiple but with much better than market secular opportunity.

Amidst record levels of inflation, Alphabet is still allocating capital to fuel organic growth first and then to M&A, especially in the hardware and cloud space, confirmed CFO Ruth Porat in an interview with CNBC’s Deirdre Bosa. She, however, had no comments on metaverse at this point in time.

The post Alphabet reports Q4 results: ‘narrative at Google is powerful’ appeared first on Invezz.

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