Google profits hit by antitrust fine, but sales soar

Google's attempt to settle its antitrust case in Europe was too little and too late

Google's parent company Alphabet announced last night that it has posted a net profit of $3.2 billion on revenues of $32.7 billion in the quarter ending June 30.

Alphabet is expected to report per-share earnings of $9.66, excluding the impact of a $5.07 billion charge accrued in connection with a European Commission fine, according to analysts polled by FactSet. Advertising was still the main source of revenue, pulling in $28 billion in the second quarter, which was a 24 percent rise from the year-ago period.

Shares rocketed more than 4pc in after-hours trade, as the market welcomed the strong results, in what could be a sign investors tempered. The fact the company offered figures excluding fines for both the second quarter and the same period past year is telling: such things aren't limited to any one quarter. That was a little hire than the Thomson Reuters consensus estimate of $32.17 billion. On top of this, $4.4 billion came from its "other revenues" section which includes the Play Store and sales of consumer devices such as Pixel phones, Google Home speakers, and Chromecasts. Last year, I wrote that the company doesn't expect to be paying such fines on a regular basis, but that's proven to be wrong this year.

The bulk of Alphabet's revenue continues to come from advertising, which amounted to $28bn for the quarter, or roughly 88 per cent of sales.

Google's attempt to settle its antitrust case in Europe was too little and too late
Alphabet shares soar despite hit to profit from Google’s EU fine

Google is "looking forward to finding a solution above all that preserves the enormous benefits of Android to users", Google CEO Sundar Pichai said on a call with analysts Monday. That doesn't seem to have investors too anxious, though, as the pre-fine numbers beat expectations by a large margin, driving up Alphabet's stock price in after-hours trading by 5%. "We are analyzing the decision and I think it's too early to comment or speculate", he said.

"We remain positive on the secular ad growth story driven by mobile and YouTube combined with generally better expense management and a more shareholder-friendly capital allocation approach", Susquehanna analyst Shyam Patil said in a note to clients Monday.

Areas such as cloud computing and "other bets" have also added to Google's spending. "Our investments are driving great experiences for users, strong results for advertisers, and new business opportunities for Google and Alphabet". "Other bets", such as Waymo and Fiber, saw revenue rise 49% but only totaled $145 million in the quarter.

Related News:

  • North Korea Wants End to Korean War Before Talking Nuclear Weapons Surrender

    North Korea Wants End to Korean War Before Talking Nuclear Weapons Surrender

    South Korea has also pushed ahead with its reconciliation with the North since a landmark inter-Korean summit in April. However, the main processing building, gantry tower, and fuel tanks remained untouched, the images showed.
    White Helmets have no place in Syria now, expert notes

    White Helmets have no place in Syria now, expert notes

    He also reaffirmed "Israel will continue to act against any attempt by Iran and its proxies to entrench militarily in Syria". The White Helmets , officially called the Syrian Civil Defence, operates a rescue service in rebel-held parts of Syria.
    Trump Sends Rouhani Dire Warning, All Caps

    Trump Sends Rouhani Dire Warning, All Caps

    He accused the United States of working to weaken and "overthrow" the clerical establishment and create divisions in the country. In the case of North Korea, she notes, the crisis was declared over despite any nuclear weapons being dismantled.
  • Search for Iowa college student continues after she vanished on a jog

    Search for Iowa college student continues after she vanished on a jog

    A Facebook group called "Finding Mollie Tibbets" has been developed to help find information concerning the investigation . Tibbetts is described as 5ft 2in tall, weighs about eight-and-a-half stone, and has brown hair and brown eyes.
    Carmelo Anthony planning to sign with Rockets at vet minimum

    Carmelo Anthony planning to sign with Rockets at vet minimum

    The embattled star will find his new home in Houston , according to the New York Times' Marc Stein , once he clears waivers. With this new trade, the Thunder hopes to send the former All-Star to the Hawks in exchange for guard Dennis Schroder.
    Donald Trump ‘Very Happy’ with North Korea Progress; Not the Washington Post

    Donald Trump ‘Very Happy’ with North Korea Progress; Not the Washington Post

    Shortwave radio broadcasts from South Korea-based Free North Korea Radio, including a program featuring members of U.S. Trump said last week that US relations with North Korea "are very good and the process is moving along".
  • Fiji, Kiwis impress as Aussies crash out

    Fiji, Kiwis impress as Aussies crash out

    Two tries in the second spell to Kurt Baker and Joe Ravouvou were enough to seal the 12-7 victory and secure a semi final berth. The New Zealand Herald reported that a Kiwi double-double - and two victory hakas - stole the show at the Sevens World Cup.
    G-20 calls for more dialogue on rising trade tensions

    G-20 calls for more dialogue on rising trade tensions

    Federal Reserve looks set to raise rates twice more this year, investors have pulled out of the yuan and other global currencies. Asian stocks took Wall Street's cue on Monday, with MSCI's broadest index of Asia-Pacific shares outside Japan falling 0.2%.
    Smartphones with 48-megapixel cameras are coming

    Smartphones with 48-megapixel cameras are coming

    The new sensor boasts 48 effective megapixels which the Japanese manufacturer is labelling the "highest pixel count" in the industry.
  • Trump tweets tariffs ‘are the greatest’ and threatens additional levies

    Trump tweets tariffs ‘are the greatest’ and threatens additional levies

    The Senate has several key races in agriculture-dependent states like Missouri, North Dakota, and in this November. President Trump indicated that countries are finally coming to the negotiating table over trade tariffs.
    Tesla seeking cash from suppliers

    Tesla seeking cash from suppliers

    After the memo was leaked over the weekend, Musk tweeted : "Only costs that actually apply to Q3 & beyond will be counted". Shares of Tesla tumbled Monday on reports that the company asked suppliers for refunds to help it turn a profit.
    Three dead after man shoots 14 people in Toronto

    Three dead after man shoots 14 people in Toronto

    The injured, including a young girl, were soon rushed to a nearby hospital, American news network CNN reported . Witnesses are being transported by buses to multiple offices to speak with investigators, Toronto Police Sgt.


Most liked

FCA shares dip 4 percent in trading after Marchionne exit
Briton Mike Manley , former head of the Jeep division of Fiat, has been named as chief executive of the Fiat Chrysler group. Marchionne "helped illustrate the power of foresight and confidence and being able to make bold moves", Brauer said.

Demi Lovato rushed to hospital due to apparent overdose
The moment was caught on camera during a performance at the California Mid-State Fair in Paso Robles on Sunday and shared online. Singer Lily Allen called Lovato a "beautiful spirit" and expressed hope that Lovato "makes a full recovery soon".

Kelly Addresses Sex Abuse Claims in New 19-Minute Song 'I Admit'
Kelly released a song about his troubles in similar fashion with 'Heaven I Need a Hug, ' a response to his critics at the time. Kelly unequivocally denies such allegations and will work diligently and forcibly to pursue his accusers and clear his name".

DeRozan thanks Raptors fans with Instagram post
On Friday, Raptors president Masai Ujiri issued an apology to DeRozan, calling the unexpected trade a "gap in miscommunication". It showed that whether or not Raptor fans are happy about getting Kawhi Leonard, they will miss their homegrown superstar.