Alphabet posts revenue above expectations, shares rise

However it seems that on Monday, Alphabet (Google’s parent company, for those who are hearing about this for the first time) has managed to overthrow Apple and become the most valuable company in the world. In the other hand, Alphabet moves ahead gaining in the rewarding Internet search advertising market focusing on video and mobile advertising.

Google’s owner reported a 17.8% increase in quarterly revenue to $21.3bn – crediting strong advertising sales on mobile devices and YouTube.

Alphabet spent $3.56 billion on “Other Bets” in 2015, while Google generated $23.42 billion in profit on $75.54 billion in revenue over the same period.

Alphabet reported that is overall revenue for past year rose to $74.5 billion from $65.7 billion in 2014. Alphabet’s Class A shares jumped by more than 9% in after-hours trading.

Free cash flow came in at US$4.32 billion, up from US$2.81 billion in the prior-year quarter.

The sum of the total operating costs was mostly from the thermostats and smoke detectors from Nest, the Internet balloons of Project Loon, the investment in medical research of Verily, robots and other undisclosed moonshot projects of Google X.

Google CEO Sundar Pichai also noted during Alphabet’s earnings call that Gmail now has more than 1 billion active monthly users.

According to analysts, the spike in Google’s share price gives the company a potential estimated value of $558bn, with Apple now revalued at around $534 billion.

Google altogether beat expectations, reporting net revenue, minus partner site payout, of $17.3 billion on $8.67 earnings per share. On a sequential basis, paid clicks rose 22% from the third quarter of 2015 to the fourth quarter of the year.

Porat chalked the huge growth in paid clicks up to new ad formats that Google introduced a year ago.

Wall Street has fretted for years about how much the core Google business was being used to fund founders Larry Page and Sergey Brin’s ambitions to grow new businesses in robots, self-driving cars and spaceships.