On Monday, Google parent company Alphabet released its first earnings report since Sundar Pichai took over as CEO in December when founders Larry Page and Sergey Brin stepped down from their management roles.
On the revenue front, the snapshot was mixed, and shares slid nearly 5 percent in after-hours trading.
Total fourth-quarter revenues were $46.07 billion, compared to the consensus estimate of $46.94 billion. Earnings per share were $15.35, compared to an estimate of $12.53.
The report was highly anticipated as analysts predicted that Pichai, formerly the CEO of Google and the public voice of the company in past earnings calls, would shift toward more transparency for shareholders.
"To provide further insight into our business and the opportunities ahead, we're now disclosing our revenue on a more granular basis, including for Search, YouTube ads, and Cloud," said Ruth Porat, chief financial officer of Alphabet and Google.
This is crucial for investors as both the video streaming site and cloud computing business have become leading drivers of growth for the tech giant. The new numbers confirm the narrative.
YouTube ads pulled in $4.72 billion in revenue for the quarter and $15.15 billion for the year. That compares with $11.16 billion for all of 2018.
Google Cloud generated $2.61 billion for the quarter and $8.92 billion for the year. That compares with $5.84 billion for all of 2018.
The division is in fierce competition with the likes of Amazon and Microsoft, which have also grown their presence in the cloud computing sector significantly in recent years.
Ad revenues remain the biggest chunk of the business, however, with $37.93 billion in Q4. That's up from $33.91 billion in Q3, and $32.63 billion for the same quarter last year.
"Our investments in deep computer science, including artificial intelligence, ambient computing, and cloud computing, provide a strong base for continued growth and new opportunities across Alphabet," said Pichai. "I'm really pleased with our continued progress in Search and in building two of our newer growth areas — YouTube, already at $15 billion in annual ad revenue, and Cloud, which is now on a $10 billion revenue run rate."
Over the quarter, Google also acquired the fitness tracker company Fitbit for just over $2 billion.
It's also facing down a federal antitrust probe that could shake things up for the company in the year ahead.
The Rev. Al Sharpton is set to lead a protest march on Wall Street to urge corporate America to resist the Trump administration’s campaign to roll back diversity, equity and inclusion initiatives. The New York civil rights leader will join clergy, labor and community leaders Thursday in a demonstration through Manhattan’s Financial District that’s timed with the anniversary of the Civil Rights-era March on Washington in 1963. Sharpton called DEI the “civil rights fight of our generation." He and other Black leaders have called for boycotting American retailers that scaled backed policies and programs aimed at bolstering diversity and reducing discrimination in their ranks.
President Donald Trump's administration last month awarded a $1.2 billion contract to build and operate what's expected to become the nation’s largest immigration detention complex to a tiny Virginia firm with no experience running correction facilities.
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Cracker Barrel said late Tuesday it’s returning to its old logo after critics — including President Donald Trump — protested the company’s plan to modernize.
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Southwest Airlines will soon require plus-size travelers to pay for an extra seat in advance if they can't fit within the armrests of one seat. This change is part of several updates the airline is making. The new rule starts on Jan. 27, the same day Southwest begins assigning seats. Currently, plus-size passengers can pay for an extra seat in advance and later get a refund, or request a free extra seat at the airport. Under the new policy, refunds are still possible but not guaranteed. Southwest said in a statement it is updating policies to prepare for assigned seating next year.
Cracker Barrel is sticking with its new logo. For now. But the chain is also apologizing to fans who were angered when the change was announced last week.
Elon Musk on Monday targeted Apple and OpenAI in an antitrust lawsuit alleging that the iPhone maker and the ChatGPT maker are teaming up to thwart competition in artificial intelligence.
