(Reuters) – Alphabet Inc (GOOGL.O) reported quarterly revenue and earnings that beat expectations on Thursday, easing concerns about the short-term growth challenges facing Google, YouTube and the company’s other advertising businesses even as it faces antitrust investigations.
FILE PHOTO: Small toy figures are seen in front of Google logo in this illustration picture, April 8, 2019. REUTERS/Dado Ruvic/Illustration/File Photo
Revenue rose 19% to $38.94 billion, compared to average estimates of 16.82% growth and $38.15 billion in revenue among financial analysts tracked by Refinitiv.
Shares rose 6.6% to $1,210.88 following the results in after-hours trade, after closing about flat.
The results brought Alphabet closer to the 20% revenue growth it had generated for several years before posting 17 percent growth in the first quarter this year, which had sent shares falling.
Alphabet generates about 85 percent of its revenue from tools used in online advertising or the ad space itself.
In the first quarter, executives said results were affected by exchange rates for foreign currency, competition and an unspecified product change that had boosted results in the year-earlier period.
During the second quarter, Google announced several new advertising tools, including ads on the home page of its Google mobile app as well as new types of ad campaigns spanning YouTube and Gmail.
The company’s net income for the second quarter rose to $9.95 billion, or $14.21 per share, from $3.2 billion, or $4.54 per share, a year earlier, when it recorded a $5 billion charge related to a fine by European antitrust regulators for abusing its dominance in mobile software. Analysts’ average estimate for quarterly net income was $8.024 billion, or $11.32 per share.
Scrutiny on the company has recently intensified. On Thursday, the Texas attorney general’s office announced that a bipartisan group of state attorneys general is weighing a range of antitrust actions against big tech companies.
Reuters reported last month that the U.S. Federal Trade Commission was gearing up to investigate Google over complaints of anti-competitive behavior.
Reporting by Paresh Dave in San Francisco; Additional reporting by Arjun Panchadar in Bengaluru; Editing by Leslie Adler