Alphabet Sales Top Analyst Estimates

Alphabet reported revenue that beat Wall Street expectations, calming concern about slowing growth at the heart of the internet giant, according to Bloomberg.

Second-quarter sales, excluding payments to partners, came in at $31.7 billion, Alphabet said in a statement. Analysts were looking for $30.8 billion. The Google parent also announced a plan to repurchase $25 billion of the company’s Class C stock, the biggest buyback in the company’s history. The cloud business grew strongly, too. Alphabet shares rose more than 9% in extended trading.

Google’s advertising sales grew 16% overall. That was slower than many recent periods, but it was a welcome relief from the first quarter of 2019, when Google missed Wall Street revenue expectations and saw its shares plunge. The stock had lagged rivals recently on concern poor results might continue.

“We’re delivering strong growth,“ Ruth Porat, chief financial officer of Alphabet, said in a statement. “Our ongoing investments in compute capabilities and engineering talent reflect the compelling opportunities we see across the company.“

Cloud-computing is Google’s fastest-growing business and second-quarter results put the operation on course to generate more than $8 billion annually, CEO Sundar Pichai said during a conference call. That’s around a quarter of the sales produced by Amazon’s AWS cloud unit, but the solid growth gave investors hope that Google can keep pace with Amazon and Microsoft.

Other revenue, which includes cloud business and consumer hardware, grew 40% to $6.18 billionCapital expenditures totaled $6.9 billion in the second quarter, up 30% from last year. The same quarter last year saw a year-over-year increase of almost 90%. Net income was $9.95 billion, or $14.21 a share, in the second quarter. That compares with profit of $8.27 billion, or $11.75 a share, a year earlier, Alphabet said.