Google's Cloud Business Hits $8B Annually

Google reveals the Pixel 3a doubled its phone sales last quarter, because people like cheaper phones

Alphabet reported second-quarter 2019 earnings Thursday with revenue of $38.9 billion, up 19% compared with the year-ago quarter. Google also faces an industry wide slowdown in ad sales in the United States and Europe, with revenue from emerging markets not yet picking up the slack. However, one big benefit rightly pointed out is the number of carrier partnerships Google was able to achieve for this launch and which should, hopefully, carry over to the Pixel 4 debut. During the same quarter previous year, the company earned $11.75 EPS.

"We find ourselves in a position where traders seem to want bad news - it's like bad news is a good news scenario as long as the data is not devastating", said Craig Erlam, senior market analyst at Oanda in London.

The latest results brought Alphabet closer to the 20 per cent revenue growth it had generated for several years before posting 17 per cent growth in the first quarter this year.

Google's revenues from advertising were $32.6 billion, or 81 percent of its total revenues, and a gain of 16 percent YOY.

On average, Wall Street was looking for Q2 earnings of $11.33 per share with $38.17 billion in revenue.

Pichai further stated that Google had plans to triple the sales force of the cloud team over a few years and that the division was the third-largest revenue growth driver across the company, YouTube being the second.

It announced a $25 billion stock buyback authorization. The company offers performance and brand advertising services.

"Our ongoing investments in compute capabilities and engineering talent reflect the compelling opportunities we see across the company", stated Ruth Porat, CFO of Alphabet and Google.

On Thursday's earnings call, Pichai said that customers want the flexibility to move the cloud in their own way. Oregon Public Employees Retirement Fund grew its holdings in Alphabet by 102,010.9% in the 4th quarter.

"Investors were anticipating revenue deceleration, but Alphabet delivered a reacceleration", Atlantic Equities analyst James Cordwell told Reuters in an email.

Still, the euro's overnight index swaps are pricing in a rate cut of more than 10 basis points in September, to minus 0.50 percent. In public cloud the dominance of the top five providers is even more pronounced, as they control over three quarters of the market.

Alphabet in its earnings release on Thursday did not mention any investigations.

Alphabet on Friday acknowledged a broader U.S. Department of Justice antitrust evaluate of mountainous skills corporations and acknowledged it could possibly continue to amass with the regulator.

The investigation follows the Federal Trade Commission's $5 Bn fine over privacy lapses.

Accusations lodged against Google by rivals and other critics span its advertising, app store, search and other businesses.

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