Alphabet Inc. parent Google reported quarterly results that exceeded Wall Street estimates Tuesday, belying fears that it too would be dinged by changes in Apple Inc.’s mobile privacy policy that stung its social-media brethren.
The search-engine giant GOOGL GOOG, dominant in global digital advertising, reported net income of $18.94 billion, or $27.99 a share, in its fiscal third quarter, compared with net income of $11.25 billion, or $16.40 a share, in the same quarter last year.
Revenue after removing traffic-acquisition costs ($11.5 billion) increased to $53.62 billion from $37.97 billion in the year-ago period. Overall revenue was $65.1 billion, up 41%.
Analysts surveyed by FactSet had estimated net income of $23.73 a share, on ex-TAC revenue of $63.5 billion.
Significantly, Alphabet’s operating margin improved to 32% in the quarter, vs. 24% in the same quarter a year ago.
“Five years ago, I laid out our vision to become an AI-first company. This quarter’s results show how our investments there are enabling us to build more helpful products for people and our partners. Ongoing improvements to Search, and the new Pixel 6, are great examples,” Alphabet Chief Executive Sundar Pichai said in a statement announcing the results.
Google’s resilient results offered reassurance following earnings warnings from Facebook Inc.
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and Snap Inc.
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in recent days. Both companies blamed lower ad revenue on restrictive new mobile privacy policy changes imposed by Apple this year.
Google’s total advertising rose 43% to $53.1 billion. Search comprised $37.9 billion, up from $26.3 billion a year ago. YouTube ad sales continued to outperform, jumping to $7.2 billion from $5 billion a year ago.
Google’s Cloud revenue climbed 47% to about $5 billion, though the division trails in cloud revenue from rivals Amazon.com Inc. AMZN and Microsoft Corp.
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Alphabet shares are up 59% so far this year, while the broader S&P 500 index SPX is up 22% in 2021.
This post was originally published on Market Watch
