Thursday, 26 October 2017

Alphabet (GOOG) third quarter beats estimates: $27.8 billion, revenues up 24%

Google parent Alphabet announced third-quarter results. Both revenues and earnings per share beat Wall Street estimates.

The company reported roughly $27.8 billion in total revenues (up 24 percent), with Google contributing all but $302 million of that amount. Earnings per share were $9.57, which was about $1.24 higher than expected.

Advertising generated just over $24 billion in quarterly revenue. Operating income was about $7.8 billion. However, traffic acquisition costs (TAC) rose to $3.1 billion (vs. $2.6 billion a year ago). There are sure to be analyst questions about that item.

The revenue breakdown by segment:

  • Google properties: $19.7 billion
  • Google network: $4.3 billion
  • Google “other revenues”: $3.4 billion
  • Other bets: $302 billion

Paid clicks on Google properties were up 6 percent year-over-year and aggregate cost-per-click (CPC) was up 1 percent. Here’s more detail:

  • Aggregate paid clicks overall up 47 percent (year over year)
  • Paid clicks on Google properties up 55 percent
  • Paid clicks on the Google Network up 10 percent
  • Aggregate CPCs down 18 percent year over year (up 1 vs. last quarter)
  • CPCs on Google properties off 21 percent
  • CPCs on Google Network were off 5 percent but flat sequentially

Paid click growth was significant. However, CPCs were down (18 percent) from a year ago but up slightly (1 percent) from last quarter. Alphabet (GOOG) shares are up in after-hours trading.

The company says it now has more than 78,000 employees compared with just under 70,000 a year ago. The earnings call webcast is happening now.

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Author: Greg Sterling

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source https://news.scott.services/alphabet-goog-third-quarter-beats-estimates-27-8-billion-revenues-up-24/

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