Today, according to the bell, Alphabet, the parent company of Google, reported performance in the first quarter of 2020. The company's revenue of $ 41.16 billion in the three-month period exceeded expectations and exceeded analysts' estimates of 40.33 billion U.S. dollar. However, earnings per share fell short of expectations. The street anticipated earnings per share of $ 10.38, while Alphabet saw lower earnings per share of $ 9.87.
Alphabet shares rose around 2.8% in over-the-counter trading after losing 3.3% in regular trading.
Within the alphabet With his CFO Ruth Porat, the profit report was a kind of warning He noted a decline in business in the later quarter and said, "Performance was strong in the first two months of the quarter." In March [alphabet], however, there was a significant slowdown in advertising revenue.
Google generates the majority of Alphabet’s revenue and profits, which in turn are largely generated from advertising revenue. In fact, the company's advertising revenue from Search, YouTube, and its network accounted for 82% of its revenue in the first three months of the year.
Alphabet's various Skunkworks projects, referred to as "other bets," generated less revenue than in the prior-year quarter and only generated $ 135 million in the first quarter of 2020, compared to $ 170 million in the previous year. As a result of this decrease in sales, Other Bets' operating loss increased from just $ 868 million to $ 1.12 billion.
The company's mixed results and the fact that business quality deteriorated in March could not reassure investors worried about a more general economic downturn due to COVID-19 and the resulting economic impact. Ad-based companies are struggling after the pandemic and a decline in consumer and business spending, which has set ad spending on fire.