Alphabet Stock (NASDAQ:GOOG)
As soon as Wall Street saw Alphabet’s (NASDAQ:GOOG) results for the third quarter and overall company performance, it promptly slashed the Alphabet stock, sending it down by about 10% on Wednesday.
On Tuesday, the Google parent company announced a profit of $1.06 per share on sales of $69.1 billion. Thus the drop came as a surprise. Investors expected Alphabet (GOOG) to post $1.26 per share in earnings on $71 billion in revenue. Alphabet (GOOG) earned $1.40 per share on $65.1B in sales during the same time last year.
YouTube ad revenues dropped by 2% to $7.07B, below analysts’ projections of $7.1B. This was noted as a key factor hurting Alphabet’s performance. The advertising market saw a 2.5% increase in income to $54.5B. However, this was still lower than the predicted $56.6B.
Doug Anmuth, an analyst at J.P. Morgan, has said that Alphabet stock is suffering along with the rest of the Internet advertising sector.
Mr. Anmuth said Alphabet stock “substantial over-earned in 2021 due to a quickly reviving online ad market post-pandemic despite slowing workforce expansion. But now the opposite is happening, and sales growth is slackening very sharply.”
At the same time, Facebook’s parent company, Meta Platforms (NASDAQ:META), contributed to the Internet sector’s troubles on Wednesday when it reported disappointing profits for the third quarter and cautioned that revenue would likely be challenged in the next year.
Featured Image- Unsplash @ Mitchell Luo
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