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Alphabet, Google’s parent company, surpasses sales estimates as advertising revenue rises

By Paresh Dave and Subrat Patnaik

Apr 27 (Reuters) – Alphabet Inc, Google’s parent company, beat analyst estimates for quarterly revenue on Tuesday and announced a $ 50 billion share buyback, as a recovering economy and growing use of Online services accelerate your advertising and cloud businesses.

Alphabet shares rose about 4% to $ 2,375 in after-hours trading on Wall Street.

The results are the first sign that Google services may profit from the rise in usage generated by lockdowns and other restrictions due to the coronavirus pandemic, which forced people to shop and communicate online over the past year. .

Google’s ad sales increased 32% in the first quarter compared to a year ago. Cloud sales increased 45.7%, in line with analyst expectations according to Refinitiv data.

About 17% of people in the United States, Alphabet’s top region by income, were fully vaccinated against COVID-19 at the end of the first quarter.

This change coincided with Alphabet’s overall sales increasing 34% to $ 55.3 billion, above analysts’ estimate of $ 51.7 billion, or 26% growth over the first quarter of last year, when ad sales fell significantly.

Alphabet’s quarterly earnings rose 162% to $ 17.9 billion, or $ 26.29 per share, topping estimates of $ 15.88 per share.

The authorization of a share buyback by Alphabet’s board follows a $ 25 million buyback program announced in 2019.

AD BOUNCE

It’s not immediately clear which industries drove Google’s growth in advertising and cloud sales, but that topic was expected to be addressed when analysts spoke to Alphabet executives in a conference call later Tuesday.

The increase in ad buying by travel and entertainment companies is a positive sign, as hotel booking services and movie studios are among the top spenders on Google.

Google’s update on efforts to strike long-term cloud computing deals with retailers or companies that purchased services last year could also be interesting.

Google’s new consumer subscription businesses, such as an ad-free version of YouTube, could also grab analysts’ attention.

Alphabet’s stock has risen 80% in the past year, ranking 184th among companies in the S&P 500 index.

(Report by Subrat Patnaik in Bengaluru and Paresh Dave in Oakland, USA. Edited in Spanish by Manuel Farías and Rodrigo Charme)

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