Google parent Alphabet recorded a 21 percent jump in revenue during its second quarter of the year, and even though net income was down compared to last year courtesy of European Union regulators, it still came in ahead of financial analyst expectations.
The $26 billion in revenue comes almost entirely from the Google division of the company; Alphabet’s “Other Bets” group, which includes things like the shrinking Google Fiber project and Nest, recorded $248 million in revenue. Advertising revenue came in at $22.7 billion, and “Google Other” (some undisclosed portion of which is revenue from Google Cloud Platform) revenue was $3.1 billion.
On the income side, Google had already warned Wall Street that profit would be lower than usual this quarter because of the $2.7 billion fine levied against Google by the EU antitrust regulators. After the fine, net income fell to $3.5 billion, down from $4.9 billion in the year-ago quarter, but that was still significantly more on an earnings-per-share basis than analysts were expecting.
Google’s search business continues to be a cash machine. Ad revenue was up 18 percent, and paid clicks on Google’s sites were up 61 percent compared to last year. Most of that growth is coming from mobile ads and YouTube, said Ruth Porat, chief financial officer, on a conference call following the release of the results.
While Google still isn’t ready to provide details on how Google Cloud Platform is doing, Porat said that the 1,600 employees it added during the quarter are focused on Google Cloud, as Google’s Greg DeMichillie hinted at our GeekWire Cloud Tech Summit last month. Google CEO Sundar Pichai said that the company closed three times as many deals valued at more then $500,000, which supposedly shows strength among enterprise customers but doesn’t reveal all that much.
Ahead of the earnings announcement, Alphabet announced that Sundar Pichai, the CEO of Google, would join its board of directors. Pichai was named CEO of Google back in 2015 when the Alphabet parent company structure was created, elevating co-founder Larry Page to CEO of Alphabet.