Google Inc alphabet could not take advantage of a strong economy, which is backed by rivals in the first quarter as the leading online advertising company faces increasing competition in its search and enterprise hardware and suffered from the devastating changes on YouTube.
Stocks alphabet fell 7 percent after several hours after closing to 1.5 percent at a record high of $ 1,296.20.
Alphabet Chief Financial Officer Ruth Porat told analysts that the company is experimenting with its advertising products, as users grow to depend on mobile devices, and what he sees earnings volatility as a result. Google pixel phone sales also struggled in the face of fierce competition in the premium smartphone market, she said.
The main competitors for advertising costs, such as Facebook Inc, SNAP Inc, Amazon.com Inc and Twitter Inc all reported last week quarterly revenue above or in line with analysts' expectations.
Alphabet said quarterly earnings rose 17 percent compared with a year ago, $ 36.3 billion, compared with an average estimate of Wall Street at $ 37.3 billion, according to IBES Refinitiv.
17 percent of growth was the slowest in three years, compared with 26 percent for the same period a year earlier.
Facebook, number 2 on the Internet & # 39; waking company located 26 percent growth to $ 15.1 billion in quarterly results last week.
Alphabet said paid clicks fell by 9 per cent compared with the previous quarter.
Porat also said that a slowdown in revenue growth reflected strong foreign exchange and the effects of 2018. Revenue rose 19 percent in the quarter, in constant currency.
Quarterly expenses increased by approximately the same as income, to 16.5 per cent compared with the previous year to $ 29.7 billion.
But positive macroeconomic signals gave them reason to believe that the business of advertising is healthy. Shares rose 11.9 percent from its last on the & # 39; waking profits and Monday.
About 84.5 percent of revenue, compared with 85.5 percent a year ago, came from Google's advertising business, which sells links, banners and advertising through their own web sites and applications, and those partners.
3 billion users of Google are helping to make it the world's largest seller of online advertising, capturing nearly a third of all income, according to research firm eMarketer. Facebook is about 20 percent.
ABC Capital expenditures fell by 36 percent compared to the previous year to $ 4.6 billion. Moderator growth in the last quarter, as the alphabet had warned in February.
Alphabet says that its costs are increasing justified huge costs going to offices, data centers and artificial intelligence capabilities, in accordance with the expected demand for its services.
Nevertheless, the company still advertise significant revenues from its costs for enterprises, such as self-driving cars and his assistant AI Google Assistant.
New units, which produce a significant earnings lagged market share in the number of consolidated hardware division of Google and Google Cloud, computing and storage markets for business services.
And Google's rate can jump further if governments around the world to follow the growing threat to curb the ability of applications to track the users for advertising purposes. Other regulators discussed forcing the company to step up monitoring of user-generated content.
Shares alphabet received 23 per cent this year, at least growth among the so-called group FAANG to Facebook by 48 percent, Netflix 39 percent, Apple 30 percent and Amazon by 29 percent.
Alphabet expenses include a fine of $ 1.7 billion from the European Commission for having placed restrictions anticompetitive advertising on websites that use its search.
Revenue was also increased due to changes in estimates of the share of the alphabet in Annex LYFT group travel Inc, which completed an initial public offering during the month. The alphabet can see similar gains later in the year, as well as other highly valued startups, in which he has the right to property, the number of transport applications Uber Technologies Inc and the workplace firm sagging Technologies Inc software, make their public debuts.
Including European fine, net income was $ 6.7 billion, or $ 9.50 per share, compared with the average analyst estimate of $ 7.3 billion, or $ 10.48 per share. Earnings excluding penalty was 8300000000, or $ 11.90 per share, topping analysts' estimates $ 10.61 per share, adjusted earnings.
Operating margin, excluding the fine was 23 percent, compared with 22 percent in the same period last year.