Current:Home > ScamsGoogle rebounds from unprecedented drop in ad revenue with a resurgence that pushes stock higher-VaTradeCoin
Google rebounds from unprecedented drop in ad revenue with a resurgence that pushes stock higher
View Date:2025-01-07 13:52:02
SAN FRANCISCO (AP) — Google snapped out of an unprecedented advertising slump during its latest quarter, signaling a return to growth cycle needed to fuel investments in artificial intelligence technology that expected to reshape the competitive landscape.
The results for the April-June period released Tuesday by Google’s corporate parent, Alphabet Inc., reversed a financial downswing that had raised fears Google was losing its financial steam at the same time advances in artificial intelligence, or AI, threatened to undercut the dominant search engine that powers its digital ad empire.
But after Google’s ad revenue suffered year-over-year declines in consecutive quarters for the first time in its history, ad sales rose 3% from a year ago to $58.1 billion during the second quarter. That was better than analysts had been anticipating, according to FactSet Research.
Other news Salesforce CEO shares his predictions for AI and the future of work Salesforce founder Marc Benioff is among the few tech pioneers who is also still CEO at a groundbreaking company born in the 1990s. Amazon, Google, Meta, Microsoft and other tech firms agree to AI safeguards set by the White House President Joe Biden is praising new commitments by Amazon, Google, Meta, Microsoft and other companies to meet a set of artificial intelligence safeguards brokered by his White House as an important step toward managing the “enormous” promise and risks posed by the technology. Google says it’s developing tools to help journalists create headlines, stories Google says it is in the early stages of developing tools that use artificial intelligence to help journalists write stories and headlines. Facebook parent Meta makes public its ChatGPT rival Llama Facebook parent company Meta Platforms has built an artificial intelligence system that rivals the likes of ChatGPT and Google’s Bard but it’s taking a different approach: releasing it for free.Those gains helped lift Alphabet’s total revenue for the period by 7% from last year to $74.6 billion. The company posted a profit of $18.4 billion, or $1.44 per share, a 15% increase from the same time last year. Both those numbers also surpassed the analyst estimates that steer investors.
The Mountain View, California, company also announced that Chief Financial Officer Ruth Porat will take on the newly created role of president and chief investment officer. Alphabet will seek a new CFO to take over a job that Porat, a former investment banker, has handled for the past eight years.
Alphabet’s stock price surged nearly 10% in Tuesday’s extended trading after the results came out. The shares have climbed nearly 50% so far this year, with much of the gains since Google provided a deeper dive into its AI products and strategy during a May conference. That presentation helped alleviate concerns that Google is being outmaneuvered in a pivotal field of technology by Microsoft, which is backing and deploying some of the breakthroughs made by Open AI and its popular chatbot, ChatGPT.
“We are in a period of incredible innovation in search,” Alphabet CEO Sundar Pichai said Tuesday during a conference call he conducted from London, where he said he was visiting with the DeepMind division overseeing the company’s AI efforts.
The brewing battle for AI supremacy is expected to require billions of dollars in investments in the years to come – money that Alphabet should be able to get from Google’s advertising machine, as long as it can continue the steady growth of the past 20 years. But Google has recently been facing more daunting challenges, not only from the ChatGPT-like technology that Microsoft has been embedding in its Bing search engine, but also from Amazon in shopping, and TikTok and Reddit in hot topics.
Insider Intelligence analyst Evelyn Mitchell-Wolf said the past quarter showed Google remains on “the high ground. All it has to do now is keep increasing revenues while executing its carefully-laid plans to lead advertisers and consumers into the AI-powered future without any catastrophes.”
After YouTube saw its ad sales fall year-over-over in three straight quarters as TikTok’s audience swelled, Google’s popular video site also bounced back with a 4% increase in ad revenue from last year. Meanwhile, the Google Cloud division that provides the behind-the-scenes technology for a wide swath of websites posted a 28% increase in revenue from last year. The Cloud division also posted its second consecutive profitable quarter in a development that has pleased investors.
Porat’s promotion signaled Alphabet is looking to pare the losses in its long-unprofitable “Other Bets” division that includes self-driving car pioneer Waymo and other far-flung projects working on technology expected to take many years to yield a return. When she takes on her new role as Alphabet’s president, Porat will oversee the Other Bets portfolio as part of a commitment to “drive financial discipline and returns for shareholders, while spearheading investment to create sustainable, long-term value,” Pichai said in a statement.
veryGood! (21)
Related
- Tony Todd, star of 'Candyman,' 'Final Destination,' dies at 69
- Lake Powell Drops to a New Record Low as Feds Scramble to Prop it Up
- Amazon Prime Day 2023 Flash Deal: 52% Off a Revlon Heated Brush That Dries and Styles at the Time Same
- This cellular atlas could lead to breakthroughs for endometriosis patients
- A pair of Trump officials have defended family separation and ramped-up deportations
- Shawn Johnson Is Pregnant, Expecting Baby No. 3 With Husband Andrew East
- This Automatic, Cordless Wine Opener With 27,500+ 5-Star Reviews Is Only $21 for Amazon Prime Day 2023
- 'Hi, Doc!' DM'ing the doctor could cost you (or your insurance plan)
- Olympic Skier Lindsey Vonn Coming Out of Retirement at 40
- Summer School 2: Competition and the cheaper sneaker
Ranking
- Who is Rep. Matt Gaetz, the Florida congressman Donald Trump picked to serve as attorney general?
- West Baltimore Residents, Students Have Mixed Feelings About Water Quality After E. Coli Contamination
- Why the Language of Climate Change Matters
- These 25 Amazon Prime Day 2023 Deals Are Big Sellout Risks: Laneige, Yeti, Color Wow, Kindle, and More
- Climate Advocacy Groups Say They’re Ready for Trump 2.0
- Lift Your Face in Just 5 Minutes and Save $80 on the NuFace Toning Device on Prime Day 2023
- Your air conditioner isn't built for this heat. 5 tips can boost performance
- After Criticism, Gas Industry Official Withdraws as Candidate for Maryland’s Public Service Commission
Recommendation
-
Fantasy football waiver wire: 10 players to add for NFL Week 11
-
Zayn Malik's Call Her Daddy Bombshells: Gigi Hadid Relationship, Yolanda Hadid Dispute & More
-
Sofia Franklyn Slams Alex Cooper For Shady S--t to Get Financially Ahead
-
Texas Regulators Won’t Stop an Oilfield Waste Dump Site Next to Wetlands, Streams and Wells
-
American arrested in death of another American at luxury hotel in Ireland
-
OutDaughtered’s Danielle and Adam Busby Detail Her Alarming Battle With Autoimmune Disease
-
Is COP27 the End of Hopes for Limiting Global Warming to 1.5 Degrees Celsius?
-
Zayn Malik's Call Her Daddy Bombshells: Gigi Hadid Relationship, Yolanda Hadid Dispute & More