Google Parent Company Achieves $100 Billion Revenue Milestone
SAN FRANCISCO (AP) — On Wednesday, Alphabet Inc., Google’s corporate parent, unveiled its inaugural quarter, surpassing the remarkable threshold of $100 billion in revenue. This achievement underscores the formidable resilience of its vast internet empire, even amidst mounting legal and competitive pressures.
This announcement regarding Alphabet’s burgeoning revenue and profits follows a crucial court ruling in the landmark monopoly case initiated by the U.S. Justice Department. The ruling was perceived as a mild reprimand, unlikely to hinder Google’s predominant search engine.
During the third quarter, from July to September, Alphabet exhibited robust performance, reporting nearly $35 billion in profit, equating to $2.87 per share, a staggering increase of 33% compared to the previous year.
Concurrently, revenue rose 16% year-over-year to reach $102.3 billion, significantly outpacing expectations, which play a pivotal role in influencing stock market trends.
In reaction to the impressive third-quarter results, investors buoyed Alphabet’s stock price by 6% during extended trading hours on Wednesday.
This increase builds upon a striking 30% surge in Alphabet’s shares since early September, a period that has generated approximately $770 billion in shareholder wealth. This positive momentum coincided with the U.S.
District Judge Amit Mehta refusal to endorse the Justice Department’s proposal to dismantle Google to mitigate the excesses of its declared illegal monopoly.
Judge Mehta’s deliberative approach towards Google’s search dominance reflects his assessment that the swift evolution of artificial intelligence is birthing novel conversational “answer engines” from emerging tech contenders like ChatGPT and Perplexity, thereby diversifying consumer choices.
OpenAI, the architect behind ChatGPT, along with Perplexity, has introduced AI-driven web browsers that vie against Google’s market-leading Chrome browser, which the Justice Department had previously attempted to persuade Mehta to mandate for divestiture.
In response to these competitive dynamics, Google has been integrating an array of AI functionalities into its search engine and Chrome, along with other products, to fortify its dominion while exploring new technological horizons.
Notably, CEO Sundar Pichai revealed on Wednesday that Google’s AI-powered Gemini app has amassed a staggering 650 million monthly users.
Like many leading technology firms, Google has been fueling its AI aspirations through substantial investments, inciting concerns over a potentially unsustainable bubble.
Alphabet anticipates allocating between $91 billion $93 billion for capital expenditures this year, a marked increase from the previously reported $85 billion in July. A significant portion of these funds is destined for the expansive data centers essential for AI operations.
Alphabet enjoys the advantageous position of leveraging a highly profitable advertising network that Google has painstakingly cultivated over 25 years. In the third quarter, Google’s ad revenues reached $74.2 billion, representing a 13% increase from the prior year.
Additionally, the burgeoning interest in AI has greatly benefited Google’s Cloud division, which manages data centers for external clients. This segment has emerged as the fastest-growing area within Alphabet, boasting a revenue of $15.2 billion in the last quarter—a remarkable 34% increase from the previous year.
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