Google revenue, profit hike drives strong Q4 for Alphabet

Fourth quarter of 2014: $18.1 billionFourth quarter of 2015: $21.3 billion, up 18%.

The company’s combined share classes were then valued at $554 billion, beating Apple Inc (AAPL), which was worth around $534 billion and whose shares were slightly falling during extended trading.

Larry Page-led Alphabet now has a market capitalisation of $558 billion.

Alphabet said its earnings were bolstered by robust sales from online advertising.

While Google is best known as the dominant player in Internet search, it has launched a variety of projects in recent years that are marginally related at best to its core operation.

It was the first quarter the company provided information on what it calls “Other Bets” such as self-driving cars, and the solid results eased investor concerns about the company’s spending on ambitious projects.

“Essentially, what they have now is a big advertising business and a venture capital business”, Forrester analyst Frank Gillett said of the new earnings presentation.

In the fourth quarter, Google produced an operating profit of $6.8 billion on revenue of $17.1 billion, after subtracting ad commissions.

Alphabet, the new holding company that includes Google, is now the most valuable public company in the world.

The news sent Alphabet’s full market cap, which includes shares that are internally held, above Apple’s for the first time, though Apple still retains top status if you exclude internally held Alphabet shares. Wall Street had estimated that Alphabet would report $8.10 on revenue of $20.8 billion, and these predictions were considered high at the time. “It shows that Alphabet remains focused on finding the next breakout idea, which will drive long-term growth”, said Tom Taulli, analyst for InvestorPlace.com.

The market absolutely adored Alphabet’s financials and drove the stock up $39.00/ share or 5.91 percent in after-hours trading to $791.00 per share.

Google is planning to make its self driving auto unit a separate company under the Alphabet banner. The company is often criticized for overreliance on desktop ads in an environment where users are increasingly on the move to mobile devices; Ruth Porat, the company’s chief financial officer, emphasized the company’s mobile business in a press release.