Shares were falling more than 2 percent in trading after the regular session's close today. The company blamed taxes for the shortfall.
Google's ad revenue, which accounts for the bulk of its business, rose 17.4 per cent to US$22.40 billion in the fourth quarter. CFO Ruth Porat notes, "great momentum in Google's newer investment areas and ongoing strong progress in Other Bet".
The drop in the stock may have been more related to an unexplained $320 million charge the company took. Revenues rose 22 percent, or 24 percent independent of currency changes, to $26.1 billion. Still, GOOG stock has been hit by the earnings miss.
Google parent company Alphabet saw shares fall slightly after missing analyst expectations for its fourth quarter earnings report. However, Alphabet put a fresh emphasis on the dominance of YouTube in its most recent earnings call, suggesting that the growth of ads on the video portal is starting to play a more significant part in driving revenue for the company, per the Journal. The Pixel is a true, home-grown, in-house smartphone from Google that's created to take aim at the popular iPhone line from Apple Inc. Google's satellite-imagery unit, "Terra Bella", was bought for $500.0 million in 2014 when it was known as "Skybox Imaging". This quarter Pichai highlighted data analytics and security as two verticals where he belives Google's offerings are emerging as the industry leader. In the grand scheme of Alphabet, that's quite small.
During the call, Google CEO Sundar Pichai touched a lot on Google's main new areas of investment like hardware, cloud services, and YouTube.
Although traditional web advertising is weakening, Google has been able to more than make up for that weakness by expanding rapidly in mobile and by doubling down on programmatic advertising, in which algorithms and bots do all of the buying and selling of ads in real time. (NASDAQ:AMZN) in the field of voice search. Revenue in the division rose 82% versus previous year, although it had an operating loss of $3.6 billion. He said he didn't think that Google's release of the Pixel phone and potential, successor efforts in the future wouldn't harm the broader Android ecosystem.
Under its new structure, Alphabet is seeking to expand beyond its role as a search engine that provides advertising linked to queries.