by Kenrick Cai and Deborah Mary Sophia
(Reuters) – Alphabet, Google’s parent company, reported better-than-expected quarterly results on Tuesday, thanks to a 10 percent rise in online advertising sales and a jump in demand for its IT services. dematerialized (“cloud”) linked to artificial intelligence (AI).
The title of the technology giant, which ended Tuesday’s session up 1.8% on Wall Street, gained 4% in after-hours trading.
For the July-September period, Alphabet reported earnings of $2.12 per share, beating consensus for $1.85 per share, according to LSEG data.
The group’s chief executive, Sundar Pichai, said in a statement that investments in AI are “paying off”, both for the use of this technology in Alphabet’s businesses and for advertising sales.
If social networks, such as Instagram and TikTok, and the services offered by groups like Amazon appeal to advertisers, Google continues to attract demand thanks to its dominant position in the online advertising market.
This market remains solid, as Google’s advertising sales suggest, while the electoral campaign in the United States gave rise to massive spending in this area by the Harris and Trump campaigns. The Paris Olympic Games in August also benefited the sector.
In the third quarter, advertising sales on YouTube increased 12% to $8.92 billion, according to data released by Alphabet. The online video platform’s revenue exceeded $50 billion for the fourth consecutive quarter.
Alphabet’s advertising sales, which represent the group’s main source of revenue, increased to $65.85 billion.
Regarding Alphabet’s “cloud” division, turnover over the July-September period rose 35% to $11.35 billion, compared to a consensus of $10.86 billion.
This “cloud” division, which certainly constitutes a small part of the group’s revenues, is experiencing rapid growth due to the multiplication of spending by companies wishing to use services powered by AI.
Alphabet reported overall revenue up 15% to $88.27 billion for the quarter, while analysts on average expected an amount of $86.30 billion according to LSEG data.
(Deborah Mary Sophia in Bangalore, Kenrick Cai and Greg Bensinger in San Francisco; Jean Terzian)
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