Alphabet share price down 4% after Q1 results revenue miss
Google parent Alphabet stock falls after a mixed Q1 earnings report.
Google’s parent Alphabet share price is down after Q1 revenue narrowly missed expectations. However, Alphabet’s Q1 earnings were better-than-expected.
Alphabet earnings: key figures
| Earnings per share | $11.90 |
| Revenue | $36.34 billion |
| Traffic acquisition costs | $6.86 billion |
Alphabet share price down 4% after Q1 results revenue miss
Alphabet’s earnings per share were $11.90, exceeding Wall Street expectations of $10.61. Alphabet’s Q1 profits were also impacted by fines from the European Union (EU). The EU leveled a $1.7 billion fine on Google based on allegations of antitrust violations. Excluding the fine, Alphabet’s Q1 earnings were $9.50 a share.
Alphabet’s Q1 revenue was $36.24 billion, slightly less than the predicted $37.33 billion. Traffic acquisition costs, the payment Google pays to companies to be their main search engine, were $6.86 billion, falling below the projected $7.26 billion.
Advertising revenue also dropped to $30.72 billion, beneath the expected $32.64 billion. Despite the slowdown in ad revenue, Ruth Porat, Alphabet’s chief financial officer, still touted the positive aspects of Alphabet’s Q1 profits.
‘We delivered robust growth led by mobile search, YouTube, and[Google] Cloud with Alphabet revenues of $36.3 billion, up 17% versus last year, or 19% on a constant currency basis,’ said Porat.
Aside from Google, Alphabet’s ‘other bets’ like self-driving car Waymo were predicted to increase Alphabet’s Q1 revenue. Alphabet’s Q1 profits from other ventures increased slightly to $170 million, jumping from $150 million in 2018.
How did Alphabet’s Q1 earnings compare to other tech companies?
Compared to Amazon’s Q1 earnings, Alphabet’s Q1 earnings were worse -than-expected. Amazon’s Q1 earnings and revenue both surpassed expectations, while Alphabet had a mixed earnings report of high earnings and lower revenue.
What is Alphabet’s Q2 guidance?
While Google parent Alphabet didn’t give specific information about Q2 guidance, Porat said that the robust US dollar would lead to more spending to boost Alphabet Q2 revenue.
‘Based on the continued strengthening of the US dollar relative to key currencies, we expect to continue to see headwinds to our revenues and operating income again in the second quarter,’ said Porat.
Alphabet’s Q1 earnings suffer from declining ad revenue and fines
Alphabet’s Q1 earnings were high because of the growth of its Google Cloud computing division. However, Alphabet’s Q1 revenue report was mixed because of declining ad prices, overwhelming fines, and increased expenditures.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
Act on share opportunities today
Go long or short on thousands of international stocks with spread bets and CFDs.
- Get full exposure for a comparatively small deposit
- Trade on spreads from just 0.1%
- Get greater order book visibility with direct market access
See opportunity on a stock?
Try a risk-free trade in your demo account, and see whether you’re on to something.
- Log in to your demo
- Take your position
- See whether your hunch pays off
See opportunity on a stock?
Don’t miss your chance – upgrade to a live account to take advantage.
- Trade a huge range of popular stocks
- Analyse and deal seamlessly on fast, intuitive charts
- See and react to breaking news in-platform
See opportunity on a stock?
Don’t miss your chance. Log in to take advantage while conditions prevail.
Live prices on most popular markets
- Equities
- Indices
- Forex
- Commodities
Prices above are subject to our website terms and agreements. Prices are indicative only. All share prices are delayed by at least 15 minutes.
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
