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Alphabet Counting On Cloud And YouTube

Summary

Alphabet believes that its investments in machine learning and artificial intelligence will help it acquire a bigger share of the cloud market.

After launching YouTube Red, its ad-free subscription-based offering, YouTube is now counting on original content to boost revenues.

The moves come as Alphabet reported disappointing results.

After delivering stellar results a quarter ago, Alphabet (NASDAQ:GOOG) (NASDAQ:GOOGL) reported dismal results last week. The market was so disappointed with its performance that its stock reported the biggest decline in the past three years. But given the company's continued improvements, this is probably just a tiny blip.

Alphabet's Financials

Alphabet's first quarter revenues grew 17% over the year to $20.26 billion, falling short of the Street's forecast of $20.37 billion. EPS of $7.50 also was short of the market's projections of $8.00 per share. The losses were driven by a stronger dollar, higher traffic acquisition costs for Alphabet's Google segment and a substantial operating loss of $802 million on the Other Bets segment.

By segment, revenues from the Google segment grew 17% to $20.09 billion and revenues from Alphabet's Other Bets more than doubled to $166 million. Within Google segment, search revenues from Google website grew 20% to $14.33 billion while Google network members' website revenues grew 3% to $3.69 billion and other revenues grew 24% to...


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