The Alfabet Inc. stock fell about 4% in the extended session Thursday after the company reported better than expected earnings, which easily hit Wall Street expectations, but lost revenues.
The results were calculated at $ 9.19 billion in the third quarter, or $ 13.06 per share, much higher than analysts' average expectations of $ 10.42 per share, according to FactSet. Much like the last several quarters, a significant part of the Alphabet
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Profit was related to its investments: The company said $ 1[ads1],38 billion was added to the bottom line of due to gains in shares. A change in accounting standards earlier this year triggered these types of disclosures.
Overall reported alphabet revenue of $ 33.74 billion, up from $ 27.77 billion in the period a year ago.
"Our business is still strong globally, led by mobile search and our many products that help thousands of people every day," explains Alfred Finance Director Ruth Porat in a statement with earnings release.
Google produces the vast majority of the sales of the alphabet, with most of the huge bundle of cash coming from Google's advertising products. Combined, the Google reported in the alphabet $ 27.01 billion in revenue, up from $ 21.97 billion in the previous period, after accounting for traffic overhead costs, or TAC, the amount of revenue that goes to other businesses to send eyeballs to Google sites and their network. Analysts expect TAC sales of $ 27.3 billion, according to FactSet.
Google properties needed $ 24.05 billion, while the company's network of sites outside of Google showing its ads reported revenue of $ 4.9 billion. In addition to specifying what money comes from Google's websites – such as Google Search and Gmail – and the network, the company does not disclose more information. For example, analysts say YouTube is a multibillion dollar business, but the company does not report its actual size.
Google's advertising units are in lion's share of cash, but Google runs several unannounced businesses in the Google Other segment, which includes the cloud computing platform, hardware sales like Pixel phones and Google Home speakers, as well as revenue from the Play Store. Overall, these companies reported revenue of $ 4.64 billion, up from $ 3.59 billion a year ago. Analysts on average expect the companies to deliver $ 4.8 billion in sales, according to FactSet.
The alphabet's "Other Games", which are experimental companies outside of Google, but within Alphabets business structure reported a loss of $ 727 million, rising from $ 650 million last year's last year. Other sales revenue rose to $ 146 million from $ 117 million.
Alphabet inventory has grown 4.8% over the last year, while S & P 500
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index has fallen 0.7%.