Shares of Alphabet Inc. surged on Tuesday extended trading after it beat top and bottom lines for the fourth quarter.
The multinational conglomerate company hiked 9.16% or 252.12 points to $3,005.00 per share.
It followed its upturn of 1.73% or 46.81 points to $2,752.88 per share in the regular hours market.
Alphabet Inc. reported its latest earnings after the bell. It posted revenue growth of 32.00% year-over-year to $75.33 billion, outpacing the consensus of $72.17 billion.
Subsequently, Google’s advertising revenue increased 33.00% to $61.24 billion. It came in higher than the $46.20 billion in the same prior-year period.
Then, the firm’s cloud revenue elevated 45.00% to $5.54 billion from the previous result of $3.83 billion.
Accordingly, Q4 cloud operating loss narrowed to $890.00 million from the $1.14 billion loss a year ago. Regardless, it expanded from the third quarter, where the unit lost $644.00 million.
Traffic Acquisition Costs, a critical expenditure of revenue, edged up to $13.43 billion from the Wall Street expectation of $12.84 billion.
Remarkably, earnings widened to $30.69 per share, above the market average forecast of $27.34.
Overall, the latest earnings result proved that Alphabet Inc. could withstand the pressures from the pandemic and inflation.
In 2021, the company’s stock price notably edged up 65.00%, surpassing all other Big Tech companies.
However, it started the current year in negative territory, dropping 5.07% or 146.95 lower year-to-date.
Furthermore, Alphabet Inc. announced a 20-for-1 stock split that will become effective in July.
The move came after Apple Inc. and Tesla Inc. split their stock in the last couple of years.
Correspondingly, Alphabet Inc. aims to split its Class A, Class B, and Class C shares.
The decision will not change the fundamentals of the business but will lower the price of each share.
It is a typical move that firms often make when their stock trades in the thousands of dollars.
In line with this, the cost of each share could change from $2,572.88 to $128.64. This will give each existing holder 19 additional shares for every one they own.
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