Alphabet sees 4.5 percent drop in stock price

(MENAFN) On Wednesday, Alphabet Inc., the parent company of Google, experienced a notable decline in its stock price, which fell by more than 4.5 percent during the trading day. By 1:13 p.m. EDT, Alphabet's shares were priced at USD175.05, reflecting a daily decrease of 4.66 percent from the previous day's closing price of USD183.60. The drop in stock value was attributed to lower-than-expected advertising revenue from YouTube, a key component of Alphabet's digital advertising business.

YouTube's advertising revenue for the second quarter totaled USD8.66 billion, marking a 13 percent increase from the USD7.66 billion generated in the same quarter of the previous year. Despite this growth, the revenue fell short of market expectations, which had projected an earnings figure of USD8.93 billion. This shortfall in revenue contributed to the decline in Alphabet's stock price, reflecting investor concern over the platform's performance.

Overall, Alphabet reported a significant rise in its total advertising revenue for the quarter, which increased by 11.1 percent to reach USD64.62 billion, compared to USD58.14 billion during the same period last year. The growth in advertising revenue underscores the company's strong performance in the digital ad market, despite the setback with YouTube's revenue figures.

In terms of profitability, Alphabet achieved a notable improvement, with net income climbing to USD23.6 billion. This figure represents an impressive 28.3 percent increase from the USD18.4 billion reported in the previous year. The substantial rise in net income highlights the company's robust financial health and its ability to generate significant profits, even as it faced challenges with specific revenue streams.

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