Google’s parent company Alphabet on Thursday reported a fourth consecutive quarterly decline in profit, missing Wall Street’s expectations for both earnings per share and revenues as advertising sales slowed from their peaks during 2021.
Amid the super-Thursday of big-tech earnings that also included quarterly results from Apple and Amazon, Google announced net income had fallen by 34% to $13.6 billion, missing consensus expectations of $15.3 billion.
For only the second time in the search giant’s history as publicly traded company, revenue from ads fell 3.6% to $59 billion, missing estimates of $60.58 billion. Revenues from Google’s YouTube segment fell 7.6% year on year in the face of increased competition from the likes of TikTok and Instagram.
Total revenues across the business still eked out 0.95% year on year growth, with the heavy lifting done by the Google Could business, which grew 32 percent.
Google made headlines recently as one of the many tech giants along with Meta, Microsoft and Amazon to enact mass layoffs, in January announcing a headcount reduction of 12,000 across is 180,000 workforce. On Thursday Google employees protested outside the New York headquarters against the layoffs.
In earnings report Google said it expects to incur severance related charges of up to $2.3 billion as well as $0.5 billion in “office space reductions”. CEO Parachi promised last week to reduced executive pay as part of the efficiency measures, as publicly available job postings show vice president with salaries more than $500,000 are being advertised.
Google is also facing a lawsuit from the Department of Justice for anti-competitive practices in its digital ad-brokering business, which according to today’s fourth quarter results also fell 8.9% to $8.5 billion.
While shares rallied over 7% into the results, more than half was given up in afterhours trading as investors weighed the results, with the share price falling 3.6%.
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