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Alphabet’s stock jumps as ads, AI and cloud fuel strong revenue growth
- Shares of Google's parent company Alphabet Inc. traded higher in the after-hours session today following a solid earnings beat driven by strong cloud revenue growth
- Alphabet's stock was up more than 5% in extended trading, adding to a slight gain made during the regular trading session
- Alphabet's all-important Google Cloud unit delivered revenue of $11.35 billion, representing growth of 35% on the $8.41 billion in sales it reported one year earlier
- Google Search delivered $49.4 billion in sales during the quarter, up 12.3% from a year earlier, and it remains the biggest single contributor in terms of revenue growth
- YouTube's advertising revenue came to $8.92 billion, just ahead of the analyst's target of $8.89 billion, with more rapid growth than in the previous quarter
- Alphabet's results can be taken as a bellwether of what's to come from the other big tech stocks set to report earnings later this week, as he's expecting a 'very strong season' thanks to a 'surprisingly resilient economy and growingly supportive monetary outlook'
- Alphabet's advertising business also grew well in the quarter, with revenue of $65.85 billion
- Alphabet's executive team saw quite a shakeup
- In light of the results, Wlodarczak said Pivotal is raising its expectations for Alphabet in the fourth quarter and beyond, reiterating its 'buy' rating on the stock, which still has 'substantial upside from current levels'
- Alphabet Chief Business Officer Philipp Schindler said one reason for the growth is that AI is helping to improve YouTube recommendations
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