31 Jul 2020
Google’s parent company Alphabet reported a drop in revenue for the first time in its history on Thursday.
Revenue fell to $38.3bn from $38.9bn in the second quarter.
However, it surpasses analyst forecasts for its second quarter earnings. It also beat expectations for earnings per share, which came in at $10.13, instead of $8.21 as expected.
YouTube advertising revenue jumped 5.6% to $3.8bn, Google Cloud earned $3bn – up from $2.7bn, but sales from Google Search fell by almost 10% to $21.3bn.
“We’re working to help people, businesses and communities in these uncertain times,” said Sundar Pichai, Alphabet’s CEO.
“As people increasingly turn to online services, our platforms — from Cloud to Google Play to YouTube — are helping our partners provide important services and support their businesses.”
For her part, the CFO, Ruth Porat, noted: “We continue to navigate through a difficult global economic environment.
“We saw a gradual return in user search activity to more commercial topics throughout the quarter, followed by an increase in spending by advertisers.
“This resulted in an improvement in year-on-year search revenue trends during the quarter, with search revenues essentially flat to last year by the end of June.”
High profile Wall Street analyst and TV host Jim Cramer told CNBC: “Their numbers were substantially better than expected, even as their core advertising business took a major hit.
“The stock barely budged in response, but I think that’s because Alphabet’s management is so non-promotional.”
Shares see-sawed in after-hours trading but are currently up by 0.5%.
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