Internet giant Alphabet, parent of Google, announced this Thursday a net profit of 59.972 million dollars in 2022, 21% less than a year earlieralthough its billing improved almost 10%, up to 282,836 million dollars.
The company, which operates the world’s most used search engine and huge platforms such as YouTube, defrauded the markets with its accounts and, after rising strongly during the trading session, its shares fell about 6% in post-closing electronic transactions.
In the last quarter of the year, data to which investors paid the most attention today, Alphabet had a net profit of 13.624 million dollars, 34% less in the year-on-year comparison, while its turnover grew 1%, up to 76,048 million. .
Both figures were below analysts’ expectations, largely due to the deterioration of its gigantic advertising business -which accounts for most of its turnover- as a result of the current economic situation.
Alphabet earned 59.042 million dollars from advertising between October and December, compared to 61.239 million in the same period of the previous year, with drops in both its search engine and YouTube ads, which had grown very strongly during the pandemic and which they have been losing steam with the return to normality.
The firm based in Mountain View (California, USA), world leader in the field of Internet advertising, is also being affected by the general reduction in advertising spending as a result of the slowdown in the economy.
In the positive section, he highlighted the strong growth in recent months of the cloud services business, for which Alphabet entered 7,316 million dollars in the last quarter of 2022compared to 5,541 million in the same period of 2021.
At the end of January, Alphabet followed the path of other technology giants and announced a workforce reduction of some 12,000 people, 6.4% of the total, after the high number of hiring it had carried out during the pandemic.
Today, in a statement, he announced that these departures will cost him between 1.9 and 2.3 billion dollars in compensation and other expenseswhich will mostly be recorded in the accounts for the first quarter of 2023.
Alphabet also said it is taking steps to reduce its office space and expects to take a charge of about $500 million for that.
Regarding the company’s situation, the CEO, Sundar Pichai, highlighted the good progress of the cloud business, subscriptions to YouTube and its Pixel devices, as well as the long-term investments it has been making to take advantage of the takeoff of artificial intelligence and its foreseeable rise in a short time. In that sense, Pichai said that the company is preparing to soon present improvements in its searches and other services using artificial intelligence technologies.
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