Google parent company Alphabet boosted earnings and revenue in the first quarter, just not enough to meet analysts’ expectations as losses widened in its “moonshots” division.
The miss stoked a sell-off in shares, which fell 6.3 percent to $711.73 in after-hours trading. The stock had climbed about 39 percent in the last year.
After reorganizing in August as Alphabet, a holding company of search giant Google, the Internet behemoth has begun breaking out results from specific businesses for the first time, giving investors and industry watches sidelong glimpses at how businesses like its video giant YouTube are performing.
The core Google business, which includes search and YouTube and represents all of the company’s profit, saw income rise 21 percent, on a 17 percent increase in revenue.
But Google’s smaller arm with more emerging businesses, what it calls “other bets,” lost more money than it did last year. Even though revenue more than doubled to $166 million, the segment’s loss widened to $802 million.
Overall in the latest period, Alphabet reported a profit of $4.207 billion, or $6.02 a share, compared with $3.515 billion, or $5.10 a share a year earlier.
Earnings would have been $7.50 a share excluding certain item, falling short of the $7.96 a share that analysts estimated on average. Total revenue rose 17 percent to $20.257 billion, while the consensus estimate was slightly higher at $20.376 billion.
Alphabet said the number of paid clicks on the websites it owns rose 38 over the year-ago quarter. The average amount advertisers paid for each click fell 12 percent