By Jon Swartz
Google parent Alphabet Inc.’s stock initially soared 14% in after-hours trading Thursday following huge spikes in revenue and net income that trounced analysts’ predictions – as well as its first-ever cash dividend of 20 cents per share.
Alphabet’s board also authorized the repurchase of up to $70 billion in shares.
The search-engine powerhouse reported a jump in first-quarter sales, chiefly through advertising, for total revenue of $80.54 billion, up 15% from $69.8 billion a year ago. Sales minus total acquisition costs (TAC) came in at $67.59 billion, compared with $58.07 billion a year ago.
Alphabet (GOOGL) (GOOG) reported first-quarter net income of $23.66 billion, or $1.89 a share, compared with net income of $15.05 billion, or $1.17 a share, in the year-ago quarter.
“Our results in the first quarter reflect strong performance from Search, YouTube and Cloud. We are well under way with our Gemini era and there’s great momentum across the company. Our leadership in AI research and infrastructure, and our global product footprint, position us well for the next wave of AI innovation,” Alphabet Chief Executive Sundar Pichai said in a statement announcing the results.
Analysts surveyed by FactSet had expected on average net earnings of $1.51 a share on revenue of $78.75 billion and ex-TAC revenue of $65.99 billion.
Google’s total advertising sales was $61.66 billion, compared with $54.55 billion a year ago; FactSet analysts had average expectations of $60.3 billion. YouTube ad sales rose 21% to $8.1 billion from $6.7 billion a year ago. Google Cloud rang up $9.6 billion in sales, up $7.5 billion.
Alphabet did not break out AI revenue in Tuesday’s earnings report.
Shares of Google have climbed 45% over the past 12 months. The S&P 500 index SPX has risen 22% in the past year.