…Plans $50 Billion Buyback
Google parent Alphabet Inc on Tuesday reported record profit for the second consecutive quarter but warned a surge in usage and ad sales during the pandemic may slow as people resume in-person activities.
With online consumer activity remaining elevated in the first quarter, Alphabet beat analysts’ revenue estimates and nearly surpassed the sales record it set in the fourth quarter.
Alphabet pointed to elevated consumer activity online as a major factor behind record net profit in Q1, with Google’s advertising business surging following increased spending from companies as global economies open up.
Separately, Alphabet announced a $50 billion share buyback programme.
CFO Ruth Porat used Alphabet’s earnings call to explain the strong financial results reflected the impact of Covid-19 (coronavirus) on its business beginning in March 2020, along with broad strength in advertising.
“It is too early to say how durable this consumer behaviour will be as economies recover and restrictions on mobility are lifted,” she added.
Google posted a record $17.9 billion net profit, up 162 per cent year-on-year, on revenue of $55.3 billion, 34 per cent higher.
Advertising was the main driver of revenue, increasing from $33.8 billion in Q1 2020 to $44.7 billion, with YouTube ads up from $4 billion to $6 billion.
Revenue from Google Cloud followed the trend, increasing from $2.8 billion to $4 billion. Other Bets, which includes health unit Verily and automated vehicle business Waymo, went from $135 million to $198 million.
Its non-search business, covering Android marketplace and hardware including Pixel phones and its Home smart speakers, grew 46 per cent to $6.5 billion.
