Alphabet misses sales estimates; shares tank more than 5%
In the first quarter, the tech giant posted sales of $68.01 billion, an increase of 23% from the last year but lower than $68.1 billion as expected by analysts, according to Refinitiv. Alphabet posted lowest sales growth since late 2020
• YouTube posted sales of $6.9 billion missing Wall Street expectations of $7.5 billion
• Shares of the company fell 6.5% in after-hours trading
Google parent Alphabet Inc (NASDAQ: GOOGL) reported lower sales as YouTube missed expectations amid Russia-Ukraine war and rising inflation.
In the first quarter, the tech giant posted sales of $68.01 billion, an increase of 23% from the last year but lower than $68.1 billion as expected by analysts, according to Refinitiv. Alphabet posted lowest sales growth since late 2020.
Alphabet’s sales was impacted due to the ongoing war between Russia and Ukraine as the company suspended ad sales in Russia and reduction in spending by brand advertisers in Europe.
Other factors including inflation and supply-chain issues also contributed to the lower sales of the company.
Lower YouTube sales
YouTube posted sales of $6.9 billion missing Wall Street expectations of $7.5 billion, according to FactSet. YouTube benefitted particularly in the pandemic when people were restricted to their homes. TikTok’s growing market share is another reason for lower ad sales of YouTube.
Alphabet’s advertising revenue for the quarter was $54.66 billion—an increase from $44.68 billion in the same period last year.
Google Cloud Services was a hit for Alphabet in the quarter as sales rose 44% year-over-year to $5.8 billion. Cloud services, though, reported an operating loss of $931 million, compared to $974 million a year earlier.
Alphabet posted earnings per share or profit of $24.62 per share, missing expectations of $25.76 per share.
Shares of the company fell 6.5% in after-hours trading.
Picture Credits: Reuters
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