SAN FRANCISCO: Google parent Alphabet reported quarterly earnings beating Wall Street expectations on Monday, but shares slipped, with investors apparently focused on rising costs at the technology giant.
Alphabet reported a profit of US$8.9 billion in the fourth quarter on revenue that was up 22% to US$39.3 billion from the same period a year earlier.
“With great opportunities ahead, we continue to make focused investments in the talent and infrastructure needed to bring exceptional products and experiences to our users, advertisers and partners around the globe,” said Alphabet chief financial officer Ruth Porat.
Alphabet shares were down 3.6% to US$1,100.09 in after-market trades that followed release of the earnings figures from the final three months of last year.
One factor making the market wary was a 29% drop in “cost per click” or the average price of digital ads, the main source of revenue for the tech giant.
The report offered no detailed breakdown of income but Google took in the overwhelming majority of revenue in the quarter, US$39.1 billion, with US$32.6 billion from advertising.
The company’s “other bets” including its autonomous driving division Waymo and its life sciences and cybersecurity units took in US$154 million in revenue. Those operations showed an operating loss however of US$1.3 billion.
Industry tracker eMarketer forecast that Alphabet’s money-making engine Google would take in US$102.43 billion in digital ad revenue this year, commanding 31.3% of the global market.
Alphabet’s headcount grew to nearly 99,000 from 80,000 employees during the course of the year as expenses at the internet colossus climbed.