Investors punish Alphabet as it misses Wall Street estimates
Third-quarter results fanned fear that big investments in new businesses are producing slow and unpredictable returns
Bengaluru/San Francisco — Google parent Alphabet missed analysts’ quarterly revenue estimates for the first time in at least two years and reported continuing erosion of its operating margin, sending its shares down almost 7% in after-hours trading. The tech company’s third-quarter results, released late on Thursday, fanned investor concern that big investments in new businesses, increasing regulatory scrutiny and emerging competition are producing slow and unpredictable returns. Alphabet disclosed, for example, that passengers of its self-driving Waymo minivans are now paying for rides, but the offering remains limited to the Phoenix, Arizona region and Waymo’s finances are not broken out. Overall revenue rose 21% to $33.74bn, missing analysts’ estimate by about $310m, according to Refinitiv data. Google ad sales contributed 86% of revenue, but growth slowed to 20% from nearly 24% last quarter. “Google’s earnings momentum remains strong,” said Haris Anwar, senior analyst at Investi...
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