fbpx

Alphabet Q2 2016 earnings: Alphabet earns $21.5 billion with $8.42 per share

Google’s parent company Alphabet released its second quarter earnings on Thursday. The company’s total revenue totalled $21.5 billion and $8.42 per share. Analysts from Thompson Reuters expected revenues of $20.76 billion at $8.04 per share.

At $21.3 billion in earnings, Google still comprises the majority of Alphabet’s revenue. In total, Alphabet’s total revenue saw a 21 percent increase year over year.

Some of the main drivers of this growth include mobile search, advertising and video content. Google recorded $4.88 billion in net income, up from $3.9 billion this time last year.

Mobile revenue was a key focus of the earnings call, hosted by Google CEO Sundar Pichai and Alphabet CFO Ruth Porat. The company attributes some of its significant revenues to the increase in mobile search across Android and iOS.

Aggregate paid clicks grew 29 percent annually and paid clicks on Google websites were up 37 percent since this time last year. What’s also interesting is that while paid clicks on Google’s member websites went down 3 percent.

This can potentially be attributed to the fact that advertisers often pay less for user clicks on mobile ads than they do for desktop ads. Reuters suggests that these numbers suggest a successful shift from desktop — Google’s original strength — to mobile.

“The strength of the quarter is about mobile. It’s transformed the way people consume information and Google’s products have become a much-loved part of that experience,” said Pichai during Tuesday’s conference call.

Revenue for the Alphabet’s Other Bets came in at $185 million, above the analyst expectations of $168.2 million. Operating losses (non-GAAP) however rose to $859 million. The company’s earnings call discussed Alphabet’s various projects briefly, stating that several of them are still pre-revenue, early- stage ventures.

“Our Alphabet structure announced nearly a year ago gives us a framework for developing new sources of revenue growth both within google and within other bets in a different way,” commented Porat during the call. 

Currently, Fiber, Nest and Verily make up the majority of Other Bets’ revenue. Pichai went on to discuss several of the company’s additional aspirations, including virtual reality, and artificial intelligence.

Pichai discussed the Google Assistant and the company’s goal to help its users get things done in a conversational way. He used Allo, Google’s recently announced messaging app, as an example of what AI will look like within Google.

He also went on to describe the development of the Daydream VR platform, claiming that several devices with Daydream capabilities will be released this fall, though this was already confirmed during this year’s Google I/O.

“One thing is constant. we’ll continue to focus on building the best experience for billions of people around the world,” said Pichai near the end of the call.

Related reading: Google Q4 revenue soars on higher mobile ad earnings

[source]Alphabet[/source]

Comments