Google Stock Expectations in the Spotlight: Will Earnings Results Exceed Expectations?
Google is one of the most well-known and widely used tech companies in the world, and investors have been closely scrutinizing the company’s latest earnings report for clues as to how the company is performing. With expectations being high, the company’s numbers need to meet or exceed expectations in order for the stock price to remain at a healthy level.
Google recently reported a quarterly income of $22.3 billion and earnings of $6 billion for the first quarter of 2021. This figure exceeded expectations and was up nearly 38% from a year ago. Google also announced that it was increasing its spending by around 20% year-over-year — a major sign of the company’s confidence in the future. This increase in spending can be attributed to investments in research and development, as well as acquisitions.
Google’s core advertising business also beat expectations. Ad revenue came in at $33.9 billion, an increase of 34% from a year ago. Search, video, and network revenues, the company’s key drivers, were up 31%, 37%, and 43%, respectively. Despite a difficult year due to the pandemic, the company’s advertising business was able to keep rolling.
Google’s financials were further buoyed by its other operations. In particular, its cloud services business grew by a whopping 53%. This growth was driven by increases in both customers and the company’s average revenue per user. Meanwhile, Google’s hardware business was able to grow by 17%, while the company’s Play store was able to exceed expectations, growing by 21% year-over-year.
Given these strong results, it was no surprise that Google’s stock price rose after the announcement. In fact, the price jumped to an all-time high of $2,036.11 shortly after the news broke. Analysts expect this trend to continue, with the company capable of furthering its lead against its competitors.
Overall, Google’s strong first quarter earnings have given the company’s share price a boost. In addition, the company’s investments into research and acquisitions will likely yield positive results later down the line. With this in mind, investors are likely to remain optimistic. If Google can keep the momentum going and exceed expectations in the coming quarters, the stock price should remain buoyant in the near future.