Alphabet, Google’s parent company, has surpassed Wall Street’s profit and revenue projections as artificial intelligence technology continues to fuel substantial growth across its core businesses. The tech giant reported a remarkable 33.6 per cent increase in third-quarter net profit, reaching £26.3 billion, significantly exceeding analyst estimates of £22.9 billion.
The company’s revenue demonstrated robust growth, climbing 15 per cent to £88.3 billion, outperforming consensus forecasts. This impressive performance triggered a 6.6 per cent surge in Alphabet’s shares during after-hours trading, reaching £182.30.
Sundar Pichai, Alphabet’s chief executive, emphasised the company’s strategic focus on AI innovation, stating that their long-term investment approach is yielding substantial benefits for both consumers and partners. The financial results position Alphabet as a frontrunner among the ‘Big Tech’ earnings releases this week, preceding reports from Amazon, Meta Platforms, Microsoft and Apple.
Google’s core services division, encompassing search and subscriptions, witnessed a 13 per cent revenue increase to £76.5 billion. The cloud computing segment, crucial for businesses implementing AI technologies, demonstrated particularly strong performance with a 35 per cent sales increase to £11.4 billion.
YouTube, Alphabet’s video streaming platform, achieved a significant milestone with total advertising and subscription revenues exceeding £50 billion over the past four quarters. The platform’s advertising sales showed healthy growth, rising 12 per cent to £8.9 billion.
These achievements come as Google navigates potential regulatory challenges, including an ongoing dispute with the US Department of Justice regarding allegations of anti-competitive practices in the display advertising market. Despite these headwinds, the company’s robust financial performance underscores the successful execution of its AI-focused strategy.
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