Alphabet has fared very well in the first quarter of 2021. Compared to the projections made for the company’s revenue and earnings, it has really done well. The company also reported a new $50 billion stock buyback which boosted shares by almost 5 percent in after-hours trading.
The company reported revenue of $55.31 billion for the first quarter. The figure forecasted for revenue was $51.70 billion. The company’s earnings stood at $26.29 per share as against the $15.82 per share that was projected. According to Factset’s estimates, the company’s Google Cloud Revenue should fall into $4.07 billion. Alphabet fell short a little with Google Cloud revenue at $4.05 billion. According to StreetAccount, the company should generate $5.70 billion from YouTube ads in the first quarter. The company went ahead to beat this as the amount generated for YouTube ads was $6.01 billion. The company gained $9.71 billion in Traffic Acquisition Costs (TAC). Factset estimated $9.25 billion for TAC.
The company recorded huge gains from advertising even though the coronavirus pandemic reduced general advertising spend. Google’s revenue went up 34 percent compared to the first quarter of last year. Advertising revenue for the quarter stood at an impressive $44.68 billion. Compared to $33.76 billion from the first quarter of last year, this is a significant increase. YouTube ads rose 49 percent from last year to $6.01 billion. According to a recent Pew report, YouTube was the most used social media platform during the pandemic. The report also says that the amount of adults using YouTube increased from 79 percent in 2019 to 81 percent this year.
Google’s Cloud revenue was in line with the expectations of Wall Street. YouTube’s Shorts, has about 6.5 billion daily views and has grown from 3.5 billion as at the end of January. Alphabet also had a $4.84 billion profit in the value of ‘certain investments’ that were not revealed by the company. According to CNBC, this was offset by a loss of $86 million in the value of other unspecified investments, for a total net gain of $4.75 billion. Alphabet on Tuesday in a filing also authorized another stock repurchase of up to $50 billion.