Last Tuesday, Alphabet Inc
Second Quarter Highlights
Driven by search as well as cloud, which surpassed $10 billion in quarterly revenues and $1 billion in operating profit for the first time, revenue grew 14% YoY to $84.74 billion, surpassing LSEG's $84.19 billion consensus estimate.
YouTube advertising brought in $8.66 billion, which was short of StreetAccount's $8.93 billion.
On the other hand, Google Cloud revenue brought in $10.35 billion, surpassing StreetAccount's estimate of $10.20 billion.
Advertising business continued to grow, although at a slower pace compared to the first quarter, with revenue reaching $64.62 billion, growing from last year's comparable quarter when it amounted to $58.14 billion.
"Other Bets" unit that is home to the self-driving car company Waymo, brought in $365 million, growing from last year's comparable quarter when it amounted to $285 million.
With traffic acquisition costs of $13.39 billion coming in lower than StreetAccount's $13.54 billion, net income also grew from last year's comparable quarter when it amounted to $18.4 billion, or $1.44 per share to $23.6 billion, or $1.89 per share.
The AI Story Remains Vague
While Alphabet continues to spend billions to build its AI capabilities with majority of capital expenditures going towards servers and data centers, CEO Sundar Pichai sidestepped to answer when will all this spending pay off in actual revenue. Pichai added that when it comes to such long-term bets, it is better to overinvest rather than risking to fall behind. Alphabet's latest report did not reveal how much Google's AI investments are contributing to its bottom line.
On the other hand, Microsoft Corporation