Shares in Alphabet, Google\u2019s parent company, fell by more than 10%, TechSpot reports. Investors reacted negatively to the company\u2019s financial results, particularly slower growth in search revenue and difficulties monetising its new AI Mode feature.<\/p>\n
Alphabet reported quarterly revenue of $127.6 billion, up 25% year-on-year. However, earnings per share came in at $2.12, below analysts\u2019 expectations of approximately $3.01. The company\u2019s net profit fell to $26.2 billion. One contributing factor was an $8.7 billion write-down related to equity investments in other companies.<\/p>\n
Spending on artificial intelligence infrastructure is a particular cause for concern. Alphabet\u2019s capital expenditure reached $51.4 billion in the quarter, more than double the $24 billion spent in the same period last year. The company maintained its full-year capital expenditure forecast of $195\u2013205 billion. Alphabet also expects capital expenditure to increase substantially again in 2027.<\/p>\n
Meanwhile, free cash flow for the quarter was negative, at -$9.1 billion.<\/p>\n
Another challenge for Google is monetising AI Mode, a search feature that uses artificial intelligence to generate answers to users\u2019 queries. The company\u2019s Chief Business Officer, Philipp Schindler, acknowledged that queries made through this feature currently generate less advertising revenue than traditional Google searches. The company did not disclose the extent of the difference in profitability.<\/p>\n
Google\u2019s search business revenue increased by 12% during the quarter. By comparison, growth stood at 17% in the previous quarter, indicating a slowdown in one of Alphabet\u2019s main revenue streams.<\/p>\n
At the same time, Google\u2019s cloud division delivered significantly stronger results. Its revenue more than doubled to $30.71 billion, exceeding analysts\u2019 forecast of $29.57 billion.<\/p>\n","protected":false},"featured_media":152384,"menu_order":0,"template":"","newscat":[9],"newstag":[],"issues":[],"class_list":["post-152383","news","type-news","status-publish","has-post-thumbnail","hentry","newscat-novosti"],"_links":{"self":[{"href":"https:\/\/ldaily.ua\/en\/wp-json\/wp\/v2\/news\/152383","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ldaily.ua\/en\/wp-json\/wp\/v2\/news"}],"about":[{"href":"https:\/\/ldaily.ua\/en\/wp-json\/wp\/v2\/types\/news"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ldaily.ua\/en\/wp-json\/wp\/v2\/media\/152384"}],"wp:attachment":[{"href":"https:\/\/ldaily.ua\/en\/wp-json\/wp\/v2\/media?parent=152383"}],"wp:term":[{"taxonomy":"newscat","embeddable":true,"href":"https:\/\/ldaily.ua\/en\/wp-json\/wp\/v2\/newscat?post=152383"},{"taxonomy":"newstag","embeddable":true,"href":"https:\/\/ldaily.ua\/en\/wp-json\/wp\/v2\/newstag?post=152383"},{"taxonomy":"issues","embeddable":true,"href":"https:\/\/ldaily.ua\/en\/wp-json\/wp\/v2\/issues?post=152383"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}