Alphabet Q3 earnings miss overshadows cloud growth and drives shares lower
Alphabet reported third-quarter EPS of $2.12, below the $3.02 analyst consensus, while revenue rose 25% year over year to $127.6 billion. Google Cloud revenue increased 103% to $30.7 billion, but capital expenditures reached $51.4 billion and quarterly free cash flow was negative $9.1 billion as the company expanded AI infrastructure. Alphabet shares fell 7% after the results.
Why it matters
The earnings shortfall and higher AI investment raise the financial cost investors must assess against Alphabet’s rapid cloud growth. The reported results also show that heavy infrastructure spending reduced quarterly free cash flow, while the stock declined 7%.
Key facts
- 1Alphabet reported EPS of $2.12 against an analyst consensus of $3.02 for the third quarter. investing.com
- 2Revenue increased 25% year over year to $127.6 billion. investing.com
- 3Google Cloud revenue rose 103% to $30.7 billion, and its operating income increased to $11.1 billion from $3.6 billion a year earlier. investing.com
- 4Capital expenditures were $51.4 billion in the quarter, compared with $24.0 billion a year earlier. investing.com
- 5Free cash flow was negative $9.1 billion in the quarter. investing.com
- 6Alphabet shares fell 7% after the earnings report. investing.com
Summary written by AlphAI AI Desk from 2 of 2 sources. Not investment advice. Figures are as stated by the linked sources.