Google continues to benefit massively from the boom in online advertising in the Corona pandemic. The Internet giant's umbrella company, Alphabet, posted a 32 percent jump in revenue and a profit of $20.6 billion (18.3 billion euros) in the past quarter. The mainstay of the business remains the ads surrounding Internet search queries.
In the pandemic, more ad spending moved online and at the same time people are doing more things online. Google is benefiting from both trends. Ad revenue around the Google search engine rose nearly 36 percent year over year to $43.3 billion. The video platform YouTube brought in 8.6 billion dollars, around a quarter more advertising revenue than a year earlier.
Overall, Google's ad revenues rose from $46.2 billion to $61.2 billion within a year. With an operating profit of around $26 billion, Google services were also the only profit driver.
Cloud offerings, meanwhile, saw revenue rise from $3.8 billion to $5.5 billion, while operating in the red by $890 million. Google is trying to catch up with rivals Amazon and Microsoft in the business of software and storage from the web.
The group's so-called "other bets," such as self-driving cars and delivery drones, made less revenue while posting more losses. Revenue fell to $181 million from $196 million. Operating losses rose from $1.1 billion to $1.4 billion.
Overall, Alphabet significantly exceeded market expectations with its quarterly figures. Group revenue reached 75.3 billion dollars, while analysts had rather expected a good 72 billion dollars. The bottom line is that the quarterly profit rose from 15.2 to 20.6 billion dollars, as Alphabet announced after the close of the U.S. stock exchange on Tuesday.
The stock jumped a good nine percent in after-hours trading. Alphabet also announced a 1-for-20 stock split. That will make the paper more affordable for small investors and easier to trade, after the price was recently above 2700 dollars.
Google - like Facebook and Apple - has recently come under scrutiny from U.S. competition regulators, who are increasingly looking to curb the market power of tech giants. The head of Google and Alphabet, Sunder Pichai, appealed to U.S. lawmakers in a conference call with analysts to consider "unintended consequences" of proposed legislation that would leave users with inferior services and weaken U.S. platforms.
Photo by Mitchell Luo