Google's parent company Alphabet announced last night that it has posted a net profit of $3.2 billion on revenues of $32.7 billion in the quarter ending June 30.
The tech titan's advertising business continues to be its bread and butter, with global ad sales topping out at $28 billion, up almost 25 percent year-over-year. After subtracting Alphabet's advertising commissions, revenue was $26.24 billion USA, also exceeding Street forecasts of $25.64 billion US.
Alphabet also crushed profit expectations, reporting profits of $11.75 a share, compared with the forecast $9.30.
Alphabet ended the quarter with 89,058 employees, and Porat said the most sizable increases in headcount came from hiring engineers and sales people for the cloud business.
Google will be able to effectively shrug off a $5 billion fine and still make close to $3 billion in a single quarter. That doesn't seem to have investors too anxious, though, as the pre-fine numbers beat expectations by a large margin, driving up Alphabet's stock price in after-hours trading by 5%. Alphabet's revenues rose 26 percent in Europe, Africa and the Middle East over the same period a year ago, though some of the increase was related to currency fluctuations. "That's going to raise more and more questions about Google's business".
FILE PHOTO: The waxing moon is seen over the logo of Google at its European Engineering Center in Zurich, Switzerland July 19, 2018. While that's nearly three times the S&P 500 Index's gain, it trails Netflix, Amazon.com Inc. and even Facebook Inc., which is trading near a record after rebounding from a data-privacy scandal in March sparked consumer backlash and regulatory scrutiny.
Statistics and market research firm Statista aggregated market share data from StatCounter on Google's dominance in smartphone OS, search engine, and browser market share across select European Union countries in Q2 2018.
Adjusted earnings per share were $10.58, excluding the fine and the effects of other investments.
Amazon's encroachment into advertising has threatened Google's lucrative deals with media companies and advertisers.
Profit margins have dipped as more ads get shown on mobile devices, where Apple Inc and other firms charge fees to distribute Google search on their devices and apps.
"We are analysing the decision and I think it's too early to comment or speculate beyond what we've already said, but we will always take a constructive approach", Google CEO Sundar Pichai said during the company's earnings call with analysts late on Monday.