GOOGL: Alphabet Revenue Tops Estimates Despite Rising AI Threat. Stock Falls After Earnings.

Google CEO Sundar Pichai praised the results as ad business showed no signs of slowdown even as rivals beef up their AI search capabilities.

• Alphabet stock GOOGL dipped a little over 2% in after-hours trading, following the company’s earnings report. Strong revenue in the second quarter surprised investors that the looming threat of artificial intelligence (looking at you, ChatGPT) hasn’t made a significant dent in the tech giant’s search business. At $84.74 billion, revenue surpassed analysts’ calls for $84.3 billion, marking a solid 13.6% increase from a year ago.
• Earnings per share for the June quarter landed at $1.89, topping the forecast by Wall Street with four cents and soaring 30% from the same quarter last year. Search ads were behind more than half of the revenue flowing in, accounting for $48.5 billion. Sales of YouTube ads (yes — including the unskippable and annoying ones) rose 18% to $8.7 billion. The figure was slightly lower than the 21% rise in March but at least fewer people waited to hit the “SKIP” button.
• Net income was $23.6 billion, up from the year-ago quarter’s $18.3 billion and above the $22.9 billion penciled in by analysts. The results “show tremendous ongoing momentum in search and great progress in cloud, with our AI initiatives driving new growth”, said chief executive Sundar Pichai. Alphabet stock remains a formidable force, flexing a valuation of $2.26 trillion as the fourth most expensive company.