Alphabet Inc (NASDAQ: GOOGL) reported its financial results for the first quarter on Tuesday that came in just shy of Wall Street estimates. Shares are down more than 6.0% in after-hours trading.
Key takeaways from Alphabet Q1 earnings report
Net income printed at $16.44 billion versus the year-ago figure of $17.93 billion.
Per-share earnings came in at $24.62, a decline from last year’s $26.29.
Operating margin remained unchanged at 30%, as per the earnings press release.
Revenue (excluding TAC) jumped 23% YoY to $56.02 billion in Q1.
FactSet consensus was for $25.74 of EPS on $56.1 billion in ex-TAC revenue.
Advertising, Search, and YouTube Ad sales were up 22%, 24%, and 15%, respectively.
At $5.80 billion, Cloud revenue noted an annualised growth of 44%. For details on future guidance, listen to the tech giant’s earnings conference call here.
Osterweis’ Larry Cordisco reacts to Alphabet Q1 results
Alphabet announced a stock repurchase programme worth $70 billion on Tuesday – a massive increase from last year’s $50 billion. On CNBC’s “Closing Bell”, Osterweis Capital Management’s Larry Cordisco said:
It’s a bit more of a cyclical company than Microsoft. It’s exposed to advertising and we saw weakness where we thought we might see weakness; the YouTube part. Does it change the long-term story? No.
Alphabet Inc stock is roughly 20% down year-to-date. Cordisco agreed that a slowdown in EPS and revenue was a bit concerning but said much of it was likely priced in already. He noted:
Look at the comparisons from last year, the rebound out of COVID was extremely strong. Of course, it’s going to slow. Mathematically, it’s almost impossible especially for company of this size not to slow. The question is what’s an appropriate multiple. Around 20-21 times, a lot of this is priced in.
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