Alphabet, Google’s parent company, reported sales that were not short of Wall Street expectations, weighed down by a disappointing growth in the company’s cloud-computing division, which sells the company’s artificial intelligence tools to other companies .
The Silicon Valley giant recorded $ 95.5 billion revenue in its latest quarter, with an increase of 12 % compared to the previous year, but short of $ 96.6 billion that Wall Street analysts expected. The profit was $ 26.5 billion, an increase of 28 % that strictly beat the estimate of $ 26 billion analysts.
Google’s Cloud division has become an essential component of the company’s passage to generative artificial intelligence, the technology that created a spending boom in Silicon Valley and beyond. Google Cloud sales were $ 11.95 billion in the fourth quarter, with an increase of 30 percent compared to the previous year, but short of $ 12.2 billion that analysts expected.
The results raise questions that the IA will demonstrate an advantage for Google Cloud, which remains smaller than Amazon and Microsoft’s competing services. Alphabet has invested a huge amount to try to strengthen his artificial intelligence offers, among the concerns of investors that American companies could spend too much in AI compared to their Chinese counterparts.
The internet giant announced that it would have spent $ 75 billion of capital expenses in 2025, last year acceleration.
Alphabet shares collapsed by 6 % in the after -sales trade.
Ai Deep-up’s Chinese start-up caused the American market ground last week after its chatbot app grew up in popularity. Deepseek said he had formed his system for only $ 6 million, a fraction of what technological giants such as Google spends. Alphabet’s stock had a blow, among many others, although he recovered. Since then, the technology professionals have questioned some of Deepseek’s statements.
However, the episode highlighted Alphabet’s crucial need to obtain the right IA, in order to maintain its digital services relevant to consumers and companies that have never been vitiated for the choices.
The Google search engine, seen as a vulnerable to the changes of the changing age since the open chatgpt has stormed the world in 2022, so far is strong. The most popular research product in the world remains and in the fourth quarter it generated $ 54 billion entrances. Analysts expected $ 53.4 billion.
While the alphabet continues to invest in artificial intelligence, it has also continued efforts to reduce other costs, also through the reductions of the labor forces. Last week, the company said she had offered volunteer buyouts to employees in the Department of Platforms and Devices, head of its Chrome web browser and Pixel smartphones. The company also cut almost two dozen roles on YouTube this week, according to an e -mail displayed by the New York Times.
Advertising sales on YouTube rose by 14 % to $ 10.5 billion, above $ 10.2 billion expected by analysts.