Google’s parent Alphabet reported its first-quarter earnings for 2022 on Tuesday and the results fell short of analysts’ expectations. The company’s stock declined about 3 percent in Tuesday’s extended trading on the results.
In the quarter, the company reported earnings per share of $24.62 per share, falling short of expectations of $25.91 per share that analysts had projected for the quarter, according to Refinitiv. The company reported first-quarter revenue of $68.01 billion compared to the $68.11 billion that analysts estimated for the quarter, according to Refinitiv.
YouTube advertising revenue came in at $6.87 billion for the first quarter. Analysts had forecast this figure to come in at $7.51 billion, according to StreetAccount. Google Cloud revenue, however, beat StreetAccount’s estimates of $5.76 billion. This revenue came in at $5.82 billion for the quarter.
Alphabet reported traffic acquisition costs (TAC) of $11.99 billion. Analysts at StreetAccount had forecasted it to come in at $11.69 in the quarter.
Revenue which came in at $68.01 billion was up 23 percent. The company has started to see a decline from the pandemic and early post-pandemic periods.
Advertising revenue for the quarter came in at $54.66 billion. This revenue was up from $44.68 billion in the same period a year ago.
Ad revenue for YouTube fell below analysts’ expectations in the quarter. YouTube saw a boom from the pandemic which kept people at home and glued to their devices. Besides that, the short video-sharing platform TikTok has a growing share of the social media video market. TikTok was the most downloaded app in the first quarter of 2022. During a call with analysts, Chief Financial Officer Ruth Porat said that YouTube had “modest growth” majorly in direct response ads. Chief Executive Officer Sundar Pichai said that Shorts, its TikTok rival, now records 30 billion daily views. This is double what it used to have in the previous quarter and four times more than what it had in the previous year.
Although Google’s Cloud business grew 44 percent and surpassed estimates, the segment is still losing money. It reported an operating loss of $931 million in the quarter. In the same period as the previous year, it reported an operating loss of $974 million.
Alphabet’s stock was down 18 percent for the year as of Tuesday’s close.
Like other global companies, Google halted its services in Russia.
