According to reports on 3 February, Alphabet Inc., Google’s parent company, briefly touched USD 2 trillion in value as its shares rose by over 8% following its latest quarterly report. The company’s value peaked just above USD 2 trillion at the opening of trading. Analysts expect the share value to continue increasing, leading to Alphabet joining Apple and Microsoft as companies valued over USD 2 trillion, a number that Alphabet hit briefly in late 2021.
US dominance
The company earned nearly 46 per cent of its fourth quarter revenue, USD 34.7 billion, from the US market. In Europe, the Middle East and Africa, the company made USD 23.2 billion, or 30.7% of its total sales.
Stock price to rise
As of the close of trading yesterday, Alphabet’s stock was close to its largest one-day percentage gain in almost two years.
At least 20 brokerages raised their price targets on Alphabet’s stock after the company late on Tuesday delivered record quarterly sales that topped expectations, according to reports. The median analyst price target is now USD 3,450, 16% above its price at the time of writing.
Alphabet also announced a 20-to-1 stock split, which will give shareholders 19 shares for every share they hold. The split will take place in July
Breakdown
Google’s services business, which includes advertisements, Android, Chrome, hardware, Maps, Search, Google Play and YouTube, accounted for more than 92% of the company’s total sales. It added USD 69.4 billion to overall revenue, up almost 31.2% over the fourth quarter of 2020.
Google’s advertising revenue from Search, YouTube and other businesses increased 32.5% YoY to USD 61.2 billion in the fourth quarter. YouTube itself added more than USD 8.6 billion to Alphabet’s revenue, surging more than 25.3% annually, beating streaming service company Netflix’s fourth-quarter revenue of USD 7.7 billion.
The total revenue from the cloud business grew an annual 44.6% to more than USD 5.5 billion.
The company’s double-digit growth in fourth quarter sales reflected “broad-based strength in advertiser spend and strong consumer online activity, as well as substantial ongoing revenue growth from Google cloud”, Alphabet’s chief financial officer Ruth Porat said.
