Alphabet Q4 results fall short of estimates from wobble in core ad

By Yasin Ebrahim

-- Alphabet reported Thursday weaker-than-expected earnings and lilium lily foreign exchange official login websiterevenue for the fourth quarter as weaker online ad spending weighed on performance. The company also said that Q1 results would reflect a hit from costs related to job cuts.  

Alphabet Inc (NASDAQ:) fell more than 1% in afterhours trading following the report.

The company earnings of $1.05 per share on revenue of $76.05 billion. That compared with expectations for earnings of $1.18 per share on revenue of $76.07B.

The miss on the top and bottom lines comes as revenue in its core advertising business was dented by a fall in revenue as advertisers, wary about the weaker economic backdrop, reined in spending.

Advertising revenue fell to $59B in Q4 from $61.24B in the prior-year period, with YouTube advertising revenue declining to $7.96B from $8.63B.

Google Cloud revenue jumped to $7.32B from $5.54B in the period-year period. 

Traffic acquisition costs, or TAC, a major cost for Google, fell to $12.93B from $13.43B. 

Against the backdrop of softer ad-spend, the tech giant has turned to cost-cutting measures, announcing earlier this month that it would axe about 12,000 jobs, or 6% of its global workforce.

As a result of the job cuts, the company flagged employee severance and related charges of $1.9B to $2.3B, the bulk of which would be recognized in the first quarter of 2023.

The tech giant also said its exit costs from trimming down its global office space would incur a $0.5B expense in Q1.

"We have significant work underway to improve all aspects of our cost structure, in support of our investments in our highest growth priorities to deliver long-term, profitable growth," the company said.

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