Google-parent Alphabet reported first-quarter earnings and revenue that topped estimates amid one-time expenses tied to cost cutting and higher investment income. GOOGL stock dipped on Wednesday as the tech giant forecast higher capital spending in 2023 due to investments in artificial intelligence.
Reported after the market close on Tuesday, Google earnings were $1.17 a share, down 5% from the year-earlier period. Google recorded $2.6 billion in one-time charges. The tech giant reports earnings under generally accepted accounting principles, also known as GAAP.
Further, gross revenue rose 3% to $69.79 billion.
Analysts had predicted Google earnings of $1.08 per share on revenue of $68.9 billion. A year earlier, Google reported earnings of $1.23 a share on revenue of $68 billion.
GOOGL Stock: Higher Capital Spending
Meanwhile, advertising revenue was roughly flat at $54.55 billion versus estimates of $53.8 billion.
"While internet search beat expectations and cloud was good enough, Google management populated the bear case of rising AI compute intensity as it revised up its capital spending outlook modestly for 2023," said RBC Capital analyst Brad Erickson in a report.
GOOGL stock fell a fraction to close at 103.71 on the stock market today.
Google's board of directors has authorized an additional $70 billion in stock repurchases. In the first quarter, the company repurchased $14.6 billion of its own stock.
YouTube Pressured By TikTok
Meanwhile, YouTube ad revenue dipped 2% to $6.69 billion but topped views amid lowered expectations. Analysts had estimated YouTube ad revenue of $6.6 billion. TikTok's growth has pressured YouTube.
Google said cloud-computing revenue rose 28% to $7.45 billion, slightly missing estimates of $7.46 billion. Google's cloud business posted revenue growth of 44% in the year-earlier period.
The Big Tech stock had advanced 19% in 2023 amid volatility in the Nasdaq.
GOOGL stock holds a Relative Strength Rating of 59 out of a best-possible 99, according to IBD Stock Checkup. Heading into the Google earnings report, shares traded 1% below an entry point.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.
