Alphabet set to report fourth quarter results after close

Sundar Pichai, CEO of Alphabet Inc., speaks during the Americas CEO Summit hosted by the American Chamber of Commerce in Los Angeles, California, U.S., Thursday, June 9, 2022.

Kyle Grillot | Bloomberg | Getty Images

ParentGoogle Alphabet will release its fourth-quarter results on Thursday after regular markets close. Here’s what analysts expect:

  • Earnings: $1.18 per share, according to Refinitiv estimates.
  • Returned: $76.53 billion, according to Refinitiv estimates.
  • YouTube ad revenue: $8.25 billion, according to StreetAccount estimates.
  • Google Cloud revenue: $7.43 billion, according to StreetAccount estimates.
  • Traffic Acquisition Costs (TAC): $13.32 billion, according to StreetAccount estimates.

Google’s core advertising business is expected to see minimal expansion from a year earlier, and growth is expected to remain in single digits through the end of 2023, analysts estimate.

The slowing economy and competition from TikTok have hurt Google as well as its digital ad rivals Break and Facebook. Earlier this week, Snap reported lower-than-expected revenue, while Facebook’s parent Meta exceeded estimates but still recorded a 4% drop in sales.

In January, Alphabet announced that it was laying off 12,000 employees, or 6% of its workforce. The company recently told its employees that more of them are at risk of low performance ratings than in previous years.

Alphabet also cut staff at its health sciences unit Verily by 15%, citing a restructuring that is believed to better position the company to seek financial independence.

The pressure is mounting for Google in other ways.

ChatGPT artificial intelligence based chatbot, launched late last year by Microsoft-backed by OpenAI, is considered a risk for Google’s search engine. Executives teased that the company might introduce a similar product to the public at some point this year. CNBC reported this week that Google is internally experimenting with several potential products that could influence its search business.

In January, the US Department of Justice filed its second antitrust lawsuit against Google in just over two years, this one targeting its advertising business. This was the first federal lawsuit filed against Google under the Biden administration.

Google now shows its willingness to invest heavily in live sport. During the fourth quarter, the company agreed to pay $2 billion a year for the next seven years for YouTube to own the exclusive rights to “NFL Sunday Ticket.”

LOOK: US Department of Justice handles antitrust litigation against Google

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