Google owner Alphabet beats revenue expectations as ad spend recovers
Google’s parent company Alphabet beat Wall Street estimates for the first quarter amidst a recovery in digital ad spend.
Revenue rose to $55.31bn in the first quarter from $41.16bn a year earlier, beating analyst estimates of $51.7bn according to Refinitiv data.
Alphabet shares rose about five per cent to $2,405 in after-hours trading.
Digital advertising has bounced back from the pandemic-induced drop last year with revenue increasing 32 per cent to $44.68bn, up from $33.76bn a year earlier.
The company reported revenue of $4.05bn from its Google Cloud division, which has also benefited from stronger demand during the Covid crisis.
Last quarter, chief executive Sundar Pichai said the pandemic had “accelerated the shift to cloud” and investors will welcome the company holding on to these gains as lockdown restrictions start to lift.
“Over the last year, people have turned to Google Search and many online services to stay informed, connected and entertained,” Pichai said today.
“We’ve continued our focus on delivering trusted services to help people around the world. Our Cloud services are helping businesses, big and small, accelerate their digital transformations.”
Alphabet also said its board had authorised a repurchase of up to an additional $50bn of its shares.
“Alphabet is becoming a one-stop-shop for companies in the Platform Age and dependence on that one-stop-shop may increase in a cookieless world as Google attempts to build a privacy first future for the web through its Floc initiative,” WPP Mindshare’s chief transformation officer Tom Johnson said.