Instant Reaction: Alphabet Slides After Cloud Sales Fall Short
Bloomberg Surveillance
Bloomberg
3.8 • 1.2K Ratings
🗓️ 4 February 2025
⏱️ 19 minutes
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Summary
Google parent Alphabet posted fourth-quarter revenue that missed analysts’ expectations as growth in its cloud business slowed. The shares fell more than 8%. Sales, excluding partner payouts, were $81.6 billion, Alphabet said Tuesday in a statement. Analysts had projected $82.8 billion, according to data compiled by Bloomberg. The company also projected $75 billion in 2025 capital expenditures, far exceeding the $57.9 billion that analysts expected, related to a buildout of data centers and infrastructure for artificial intelligence. That led to a more than 6% boost in Broadcom shares.
For reaction and analysis just after earnings crossed, hosts Carol Massar and Tim Stenovec spoke with Bloomberg Intelligence senior technology analyst Mandeep Singh and Bloomberg Technology co-host Caroline Hyde.
See omnystudio.com/listener for privacy information.
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| 0:00.0 | A handful of social media platforms have enormous power over how much content creators earn, but this could all change. |
| 0:07.9 | Stay tuned to this podcast to find out how blockchain technology is rebuilding the creator economy. |
| 0:17.3 | Bloomberg Audio Studios, Podcastss Radio News. |
| 0:22.8 | Fourth quarter earnings per share coming in above estimates at $2.15. |
| 0:27.4 | Estimates were for $2.13. Revenue coming in just shy of estimates, but ever so slightly, |
| 0:34.3 | we can go ahead and say that meets estimates at $96.47 billion. |
| 0:38.2 | Estimates were for $96.62 billion. |
| 0:41.6 | Google ad revenue, the one that everybody is watching, came in above estimates at $72.46 billion. |
| 0:46.7 | Estimates were for $71.73 billion. |
| 0:50.1 | And then, of course, the cloud revenue so important. |
| 0:52.6 | That was a slight miss at $11.96 billion.96 billion estimates were for $12.19 billion. |
| 0:58.2 | Yeah, the company also talking about capital expenditures in 2025. |
| 1:01.5 | They say they expect to invest about $75 billion here. |
| 1:05.9 | Fourth quarter revenue, XTAC, traffic and acquisition costs, $81.62 billion. That's a little light, folks. |
| 1:12.7 | 82.82 billion. And that is what maybe is why the stock is down about 5, 5.5% here in the aftermarket. |
| 1:21.3 | Keep in mind that cloud search so important, they are facing intensifying competition. |
| 1:27.1 | Alphabet also saying AI-powered Google Cloud |
| 1:29.6 | portfolio has stronger demand. Again, one of the two key points from earnings so far, fourth-quarter |
| 1:36.7 | Google Cloud revenue. Again, as Tim mentioned earlier, so important. This is something that has |
| 1:41.7 | been really helping the company outperform. That is a miss. |
| 1:44.9 | 11.96 billion fourth quarter Google Cloud revenue. The estimate on the street was 12.19 billion. |
| 1:51.4 | And again, as I mentioned, fourth quarter revenue, XTAC, 81.62 billion. And that too is a little light, Tim. 82.82 billion. |
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