The American company Alphabet unveiled an impressive performance during the presentation of its business results. The group achieved quite interesting quarterly profits, which far exceeded market expectations. In particular, the company recorded a significant increase in turnover.
For several months now, economic activities around the world have been impacted by the Coronavirus health crisis. In this particular context, some companies have experienced a considerable drop in their revenues. On the other hand, others have been able to achieve great performances in their various businesses. This is the case of the Alphabet Group, Google's parent company.
Indeed, the famous Internet firm made very good quarterly profits. This salutary performance is, in particular, driven by revenues at an all-time high. Alphabet was able to achieve a net profit of $5.23 billion, corresponding to $22.30 per share.
A year earlier, the company's net profit was estimated at $10.67 billion, or $15.35 per share. As a result, the group recorded an increase in its operating income. This increase is 69% to USD 15.65 billion. This is well above expectations ($11.8 billion).
In addition, the American group's turnover showed a clear increase. It amounted to 56.9 billion dollars, up 23%. This is higher than the consensus FactSet expectation of $52.7 billion.
Alphabet also recorded a large increase in advertising revenues. Advertising revenues increased by more than 22% to $52.9 billion. This amount exceeds the market forecast of $42.3 billion. Excluding traffic acquisition costs, these revenues amounted to $35.73 billion.
These costs increased by 23% to $10.5 billion. In addition, YouTube revenues increased by 46% to $6.9 billion. For its part, the cloud activity generated revenues up 46.6% to $3.83 billion. It also recorded an operating loss estimated at $1.24 billion this quarter and $5.6 billion for the year, compared to $1.19 billion and $4.64 billion respectively in 2019.
In addition, it should be noted that this is the first time Alphabet has issued a press release on the results of the cloud.
Founded in 2015, Alphabet is an American company specializing in Internet services. In fact, it was created as part of Google's restructuring to refocus its search engine and Internet services activities.
Google thus becomes a wholly-owned subsidiary of the new company named Alphabet. Google's core business (the search engine and online advertising) is thus detached from the company's other activities, which are sometimes experimental.