Google’s parent company is doing something like never before – Shareholders are happy

The main numbers of the first quarter:

• 80.5 billion dollars with income Alphabet closed the first quarter, a 15 percent increase compared to the same period last year and exceeding analysts’ expectations, the markets expected $78.6 billion
• search revenue grew 14 percent, YouTube ad revenue jumped nearly 21 percent, while subscription, platform and device revenue rose nearly 18 percent
• Google Cloud revenue rose 28 percent to $9.57 billion, compared with analysts’ expectations of $9.35 billion

• the operating profit It reached $25.5 billion, which is a 46 percent increase year-on-year and a 32 percent operating profit level
• all of the operating expenses increased by less than the income, but some decreased, R&D expenses increased by only 3 percent, marketing expenses fell by 2 percent, and general and administrative expenses decreased by almost 20 percent thanks to cost control and rationalizations, which characterized last year
• among the individual segments, services, which also include the advertising business, are the main profit driver, contributing USD 27.9 billion to the group’s operating result
• for the time being, the cloud represents a small weight in the profit, it recorded an operating profit of 900 million dollars, but the growth is enormous, compared to the level of a year ago, the result has almost quintupled
• and “other bets”, which include futuristic developments, produced a loss of $1 billion
• the net result It was 23.6 billion dollars, which is 57 percent more than a year earlier, and the profit per share reached 1.89 dollars, which significantly exceeded the expectations of analysts, because based on the consensus, the expectation was 1.51 dollars

For the first time in Alphabet’s history, it has decided to pay a dividend, the quarterly dividend will be $0.2 per share, which, calculated at the current exchange rate, means a dividend of 0.5 percent.

In addition, the company also decided to buy back its own shares, would buy back another $70 billion in shares Alphabet “in the interests of the company and its shareholders,” according to the company’s quick report. There is also enough to pay dividends and buy own shares, Alphabet closed the quarter with a cash balance of 108 billion dollars.

Looking ahead, Alphabet, like its industry peers, is investing heavily in artificial intelligence, adding generative AI features to its search and services in order to retain its user base. CEO Sundar Pichai says Alphabet is well-positioned for the next wave of AI innovation.

Ahead of the quarterly report, investors were concerned about how sustainable growth in the core advertising business would be, and how significant AI investments would impact profitability. There were fears that Internet search habits would change with the advance of ChatGPT, which Google’s advertising business might feel, but so far this has not been seen in the numbers. As a result of this and the news of the dividend payment, the quarterly figures were well received by investors, Alphabet shares jumped more than 11 percent in after-hours trading.

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