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Alphabet More Valuable Than Apple As Google’s Core Business Beats Expectations
Posted On Feb 04 2016
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Apple took over from Microsoft as the most valuable company in 2010, a position previously occupied by IBM.
The search engine’s holding company Alphabet is now worth about US$568bn against the maker of the iPhone, which is valued at US$535bn, following a rise in its shares on Monday.
Alphabet shares (GOOGL) were up 6 pct after Google’s parent posted estimate-topping fourth-quarter results following the final bell. That distinction belongs to Alphabet, the recently formed parent company of Google, which reached a market capitalization of $570 billion during after-hours trading last night.
It will be the first time that the Mountain View, Calif., company is reporting financial results under its new name.
It is important to note that the stock jump came regardless of the fact that Wall Street had to deal with Google’s “other bets”, which have, as of yet, not panned out. The company’s Class C shares (GOOG) closed $752 a piece, up 1.22% and further increased more than 5% to $791 each after-hours.
In 2015, Google reported $74.5 billion (€68.3 billion) in revenues, up 13% to past year. Google had become known for its free-spending habits and reluctance to share information with analysts.
Google ad revenue climbed globally, gaining on both mobile devices and desktop computers, as per Alphabet Chief Financial Officer Ruth Porat.
Josh Olson, an analyst at Edward Jones & Co., said, “Alphabet’s core business looks very healthy”. “The hope now is that management will continue to show greater cost discipline”.
The publication of the figures on Monday excited the markets, with Google briefly overtaking Apple in market cap terms, but the balance has since been restored. “Two or three years ago mobile was a big head wind for Google”.
Advertisers pay Google only if someone clicks on their ad. If you’re not familiar, back in August executives from Google made a decision to do some restructuring to separate the company’s moneymakers from the riskier, innovative businesses.
