Google Stock: The tech world witnessed a significant event as Alphabet, the parent company of Google (GOOGL), unveiled its fourth-quarter earnings report. The numbers surpassed consensus estimates, but the stock market reaction was not entirely as expected. In this article, we’ll delve into the key highlights of Alphabet’s Q4 performance, touching on the impressive cloud growth, the advertising business, and the market’s response.

Explosive Q4 Earnings

Alphabet reported an astounding 56% surge in earnings per share (EPS) to $1.64 for the quarter ending December 31, 2023. Despite the core advertising business slightly missing views, the overall results were robust, with gross revenue climbing by 13% to reach $86.31 billion.

Google Stock: Ad Business and Cloud Computing

In Q4, Google’s advertising revenue experienced an 11% increase, reaching $65.52 billion, just shy of the estimated $65.82 billion. However, the real star of the show was the cloud computing division, which witnessed a phenomenal 25% growth, surpassing estimates and landing at $9.19 billion. This surge indicates the increasing importance of Google’s cloud services in the tech landscape.

Google Stock: YouTube Ad Revenue Holds Strong

YouTube, a subsidiary of Alphabet, continued its success story with a 15% rise in ad revenue, hitting $9.2 billion, perfectly in line with estimates. The platform’s consistent performance underlines its significance as a revenue generator for Alphabet.

Market Response and Analyst Insights

Despite the impressive financials, GOOGL stock experienced a 4.3% dip in extended trading, closing in at around $145. Analysts, like Evercore ISI’s Mark Mahaney, noted that the market’s reaction may reflect expectations that were not exceeded. However, he emphasized the fundamentally stronger quarter, citing accelerated growth in various sectors.

Stock Performance and Future Outlook

Google rebounded from a sell-off following the Q3 2023 results, indicating the resilience of the tech giant. With a 26% rally over the three months post-Q3, GOOGL stock displayed its ability to recover and even outperform expectations. As of now, the stock is holding a Relative Strength Rating of 89 out of a possible 99.

Conclusion

Alphabet’s explosive Q4 earnings report showcased the tech giant’s resilience and strength, with cloud computing emerging as a key player. While the market’s reaction may not have met immediate expectations, the underlying fundamentals paint a positive picture for Alphabet’s future. Investors and tech enthusiasts alike will be keeping a close eye on how Google continues to navigate the dynamic tech landscape in the coming quarters.

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