According to reports, Google parent company Alphabet Inc. (NASDAQ:GOOG) results have failed to match outlook, sending the tech giant’s shares dropping in extended trading on Wall Street.
Alphabet Inc. (NASDAQ:GOOG)’s profits surged 8% to $5.3 billion for the last quarter, powered by more advertising on mobile phones and YouTube. However analysts were predicting more than that, and Alphabet’s shares plunged almost 3%.
Company’s revenue for the quarter in the meantime topped $26 billion, up 22% year over year.
MOUNTAIN VIEW, CA-based Company’s advertising revenue, which accounts for the greater part of its trade, surged 17.4% to $22.40bn in the last three months period of 2016.
Furthermore paid clicks, or clicks on Google ads, surged more than 35%, in contrast with a 33% rise in the third quarter. Paid clicks are those advertisements on which companies pays only if a user clicks on them.
“Our growth in the fourth quarter was exceptional,” Alphabet chief financial officer Ruth Porat said in a statement. “We’re seeing great momentum in Google’s newer investment areas and ongoing strong progress in Other Bets.”
Moreover for the sake of earnings, Alphabet parts operations such as self-driving cars and broadband into its Other Bets category, which has almost doubled its revenue to $262 million in the quarter but still reported a loss of nearly $1.1 billion.
After restructuring itself, Alphabet (NASDAQ:GOOG) is looking for growth beyond its role as a search engine and develop new revenues streams.
Ms. Porat underscored growth app sales, hardware and the cloud business. “We see tremendous potential ahead for these businesses, as well as in the continued development of non-advertising revenue streams for YouTube,” she added.