DThe bad news from the technology industry continues: The Alphabet holding company around the Internet group Google disappointed with its quarterly figures presented on Tuesday after the stock market closed, its sales growth has weakened significantly. Their video site YouTube performed particularly poorly, even suffering a drop in sales. Alphabet’s stock price fell nearly 6 percent in after-hours trading.
Overall, Alphabet reported third-quarter revenue grew 6 percent to $69.1 billion, up 11 percent in constant currency. Analysts had expected an average of $ 70.6 billion. It was the worst development since the second quarter of 2020, when the group suffered an unusual drop in sales amid the corona pandemic. Alphabet’s net income fell 27 percent in the past three months to $13.9 billion. Earnings per share also missed expectations.
Meta will present its figures on Wednesday
The biggest weakness was Youtube. Here, sales fell by two percent to $7.1 billion, but there was still slight growth in the second quarter. A ray of hope, however, was the business with cloud computing, whose sales increased by 38 percent to 6.9 billion dollars. In this division, however, the group has so far reported losses.
The Internet group Snap, which operates the social network Snapchat, had already presented weak quarterly figures last week. It reported yet another slowdown in its revenue growth and said it was even bracing for stagnation in the final quarter of the year. The Facebook parent company Meta wants to present its figures on Wednesday.
In view of the general economic slowdown, Alphabet has already announced in recent months that it wants to pay more attention to its costs. CEO Sundar Pichai said he wants to slow down the pace of hiring this year. Unlike Snap, however, Alphabet has not yet initiated any major downsizing. On Tuesday, Pichai said the group intends to invest “responsibly” while adapting to the current economic environment.
Microsoft was in somewhat better shape with the numbers it presented on Tuesday. The software group’s sales rose by 11 percent to $50.1 billion, analysts had expected an average of $49.6 billion. Net income fell 14 percent to $17.6 billion, but earnings per share of $2.35 were 5 cents better than expected. The share price fell by 2 percent after the trading session. This could be explained by the fact that growth in the cloud business has weakened somewhat. Revenue from the Azure cloud platform rose 35 percent, up from 40 percent growth in the previous quarter.