Google’s parent company, Alphabet, has replaced Apple as the most valuable company in the world after reporting better than expected results in its first earnings report. It’s a massive business, but sales in the fiscal quarter increased only 1 percent from a year earlier, while iPad and Mac revenue dropped.
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Alphabet posted a huge fourth quarter earnings of $8.67; consensus projections called for earnings of $8.10 a share.
The new figures place the company’s valuation at around $568bn, compared to Apple’s $535bn, with the announcement sending the share price up by around nine per cent in after hours trading, having beaten analyst expectations.
Larry Page-led Alphabet now has a market capitalisation of $558 billion.
Google formed Alphabet in August 2015 to house Google and its other companies, including side projects from space exploration to self-driving cars. The torch that comes with being America’s most valuable company has been passed from tech name to tech name once again.
The latest round of financial results on Monday night saw the internet company report an 18% increase in revenue over the a year ago, as well as profits of more than £3 billion.
“We’re excited about the opportunities we have across Google and Other Bets to use technology to improve the lives of billions of people”, Porat added.
Alphabet’s market cap is now around $560 billion, while Apple, formerly the most valuable company, has a market cap of $540 billion.
Google’s massive search-ad operation is basically functioning as an incubator for Google’s “Other Bets”, which includes its self-driving vehicle project and glucose monitoring contact lense.
Ronald Josey of JMP Securities told the Reuters news agency investors would excuse those losses: “As long as the core business continues to operate well with accelerated revenue… investment in those businesses can continue”, he said.
While last year’s revenue did go up from $327 million, the operating loss that came with it was considerably higher at about $3.57 billion up from $1.9 billion in 2014.
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Like many big USA companies, Alphabet’s revenues took a beating due to the rising value of the US dollar, which severely cuts down the value of revenue earned in foreign currencies. Gmail follows Android, Chrome, Maps, Search, YouTube and the Google Play Store in topping a billion users.
