Google’s Parent Company Reports Strong Inaugural Earnings

Alphabet reported a 5.3pc increase in fourth-quarter profits to $4.9bn on Monday night and an 18pc increase in revenue to $21.3bn. On Monday, Alphabet is expected to reveal its fourth quarter and full-year 2015 earnings report, including spending on its ambitious “moonshot” projects.

Analysts on average had expected a profit of $8.10 per share and revenue of $20.77 billion, according to Thomson Reuters I/B/E/S.

These other bets are still just a small part of Alphabet’s business. Alphabet has separated its core businesses – Search, Maps, YouTube, Apps, Cloud, Ads, Commerce, Android, Chrome, Google Play and hardware sales – from its more farfetched endeavors, or “Other Bets”.

Google’s digital-ad business is so profitable that Alphabet can lose more than $1 billion on risky ventures – and shrug. “Alphabet’s claiming of the most value company title has been seen by some as a passing of the technology baton”.

Oh, and it’s just become the world’s most valuable publicly traded company. However, its other segments recorded a loss of $3.57 billion for the year. Google taking investments from its search business and pouring it into experimental projects has left investors with little clarity and search marketers with doubts.

Paid click volumes were up 31 percent compared to the same quarter in 2014, with 40 percent growth on Google-owned sites versus the Google Adsense network where other sites host ads provided by Google; YouTube’s TrueView ad format was credited with boosting clicks, particularly with mobile users.

Advertisers pay Google only if someone clicks on their ad.

Those bets include the likes of Google X, Nest, the self-driving vehicle team, the Verily life sciences company as well as Google Fiber internet and the research group Calico. The company now has $3.7 billion of repurchase authority under the board’s current authorization.

The announcement sent its share price up 9 percent in after-hours trading.

The company beat analyst expectations by reporting revenue of $21.3 billion United States (£14.7bn) for the final quarter of last year, up from $18.1 billion (£12.5bn) in the same period last year.