On Thursday Google’s parent company Alphabet Inc. (NASDAQ:GOOGL) reported its second-quarter 2019 results showing that revenue beat analyst estimates in the quarter. The promising results have eased concerns among investors with Google stock gaining 8% following the report.
Q2 2019 Revenue Beat Analyst Estimates
Google has been facing growth challenges in its ad businesses but the Q2 2019 revenue surpassed analyst estimates. It was driven solely by ad sales. Although the company has been facing antitrust issues it managed to weather the effects in the second quarter and recovered after a torrid Q1.
In the quarter the company beat analysts’ sales estimates of $38.14 billion to report sales of around $38.94 billion up around 19% from Q2 2018. Equally in terms of earnings per share the company reported EPS $14.21 exceeding analysts’ expectations of $11.30 per share in the quarter. With the promising results that the company managed to overcome the $1 billion blip in revenue miss in Q1 that resulted in lone of the largest one-day sell-off in stock in over seven years.
On Thursday in after-hours trade Google stock gained to $1,226.60 and it is on the path to the company’s largest singled day increase in over four years. The stock is however 4% shy of the high reported in April.
Antitrust Regulation Concerns
The company is facing an antitrust probe from the US Federal Trade Commission and the Justice Department but the company did not publicly confirm this during the press release. There are concerns regarding how the proposed content moderation, privacy as well as antitrust laws in the US will affect revenue as a result of slashing of ad prices. The company is also facing a slowdown in ad sales in Europe and the US while ad sales revenue from emerging economies is still lagging behind.
Sundar Pichai the CEO of Google stated that ad targeting advances and new services for customers across the globe will most likely spur growth.