Alphabet Inc Class A (GOOGL:NASDAQ)

Last update - 26 October 2022 By Rivkin

Alphabet Inc. (GOOGL) reported revenue of $69 billion, missing estimates by $1.56 billion and EPS of $1.15.

Alphabet Inc. (GOOGL) reported earnings for the quarter ended 30 September 2022 on Tuesday, with a revenue of $69 billion, missing analyst estimates by $1.56 billion. The company’s revenue declined by -1% compared to last quarter’s revenue of $65.12 billion, but increased by 6.1% on a year-on-year comparison. Segment wise, Google Search was the highest contributor ($39.54 billion), followed by Google Network ($7.87 billion), YouTube ads ($7.07B), Google Cloud and Google Other ($6.9 billion each), and Other Bets ($209 million). Net income declined by -20% on a year-on-year basis, from $17.47 billion last year to $13.9 billion in the latest quarter. CEO Sundar Pichai commented on the company’s performance, “We are sharpening our focus on a clear set of product and business priorities,” citing changes in the company’s structure, “Over the past quarter, we have made several shifts away from lower-priority efforts to fuel higher growth priorities.” 

CFO Ruth Porat cited heavy headwinds from a strong dollar impacting GOOGL’s future growth stating, “Looking to the fourth quarter, based on strengthening of the U.S. dollar quarter-to-date, we expect an even larger headwind from foreign exchange.” The company also added 12,765 employees to a total headcount of 186,779, from 150,028 a year-ago. 

EPS was $1.15, falling below estimates of $1.35, down -11% from last year’s EPS of $1.29 for the same period, and -8% lower compared to last quarter. GOOG’s share price initially declined -4% but rose +1.9% to close at $104.93. Analysts on Wall Street have a positive outlook on the stock, with 48 out of 52 recommending a buy, while the remaining recommend hold with a consensus 12-month price target of $139.02.  

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