Alphabet Just Posted a Monster Quarter. The Stock Dropped Anyway. Time to Buy the Stock?
Alphabet's Q2 was a blowout by any reasonable measure. The stock still fell 7% because investors saw the capex bill. Sometimes the market has a short attention span.
Overview
Shares of Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) fell 7% as of 10:50 a.m. ET on Wednesday, pushing the price back to mid-April levels. The reaction seems disconnected from the actual Q2 results the Google parent reported last night: revenue grew 24% to $119.8 billion, Google Cloud surged 82%, and the company beat estimates across the board.
Image source: Alphabet.
Alphabet's Q2 success was broad. Google Cloud revenue jumped 82% to $24.8 billion, with operating margins nearly doubling to 35.6%. Nearly 500 Gemini AI enterprise customers each processed over a trillion tokens in the past year. The backlog stands at $514 billion. And the "legacy" business is still thriving, too. Search revenue rose by 17%, defying bearish predictions that AI chatbots would eat Google's search-and-ads lunch.
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Originally published at www.fool.com.