Today after the bell,
Alphabet
, parent company of Google, reported
its Q1 2020 performance. The company’s $41.16 billion in revenue for the three-month period came in ahead of expectations
, besting analyst estimates of $40.33 billion. However, its earnings per share came in under expectations, with the street anticipating $10.38 in per-share profit, while Alphabet delivered a slimmer $9.87 in per-share income.
Shares of Alphabet rose around 2.8% in after-hours trading after shedding 3.3% in regular trading.
Inside Alphabet’s earnings report was a warning of sorts, with its CFO Ruth Porat noting a decline in later-quarter business, saying “performance was strong during the first two months of the quarter,” but that in “March [Alphabet] experienced a significant slowdown in ad revenues.”
generates the bulk of Alphabet’s revenue and profit, which are, in turn, largely generated by advertising incomes. Indeed, the company’s advertising revenue from search, YouTube
, and its network generated 82% of its revenue in the first three months of the year.
Alphabet’s various skunkworks projects dubbed “Other Bets” generated less revenue than in the year-ago quarter, bringing in just $135 million in Q1 2020, down from a year-ago result of $170 million. Off of that revenue decline, Other Bets saw its operating loss rise from a mere $868 million to $1.12 billion.
The company’s mixed results, and note about declining business quality in March may not assuage investors worried about broader economic deterioration due to COVID-19 and its ensuing economic impacts; advertising-based businesses are struggling in the wake of the pandemic and a decline in consumer and business spend, which has torched advertising outlays.