Alphabet , the company led by Sundar Pichai, did not have a good Tuesday. The company reported that its income was lower than expected by Wall Street as it only earned 690.9 billion dollars in the third quarter of the year , a 6% growth. Analysts had expected $710 billion. In the same period, the company had a 41% profit margin in 2021. And in fact this is the weakest period of growth since 2013.
Part of the blame for this performance was the lower number of YouTube ads, which reported that they had 2% less revenue in this period, which translates to only $544.8 billion.
Sundar Pichai, CEO of Alphabet and Google, said: “We are sharpening our focus on a clear set of product and business priorities. The product announcements we’ve made in the last month have shown that very clearly, including significant improvements to both Search and Cloud, powered by AI, and new ways to monetize YouTube Shorts. We are focused on both investing responsibly for the long term and being responsive to the economy.”
In the case of the Cloud division, the Mountain View company achieved 69 billion dollars compared to the expected 66.9 billion dollars, making it one of the most relevant verticals in this period.
Ruth Porat, Alphabet’s CFO, noted that its Search and Cloud businesses are its most profitable, but admitted that inflation has realigned its revenues.
The company also had lower profits compared to 2021, as it went from having a net income of 189.360 million dollars to only having 139.100 million dollars.