Shares in Alphabet jumped 3.6 per cent to US$1,254.12 in after-hours trade, which could mark a new record for the internet giant if confirmed when markets open on Tuesday. The EU stated that these practices breached its antitrust laws, and in addition to the fine, it gave Google 90 days "to end its practices". He wrote recently that Waymo's industry-leading technology in self-driving cars could lead to a "winner take most" position as the company is expected to roll out its first commercial service this year. Government pressure to improve moderation of user-created content has forced Google to hire more analysts.
The monster quarter came despite a regulatory backlash in Europe, rising questions about Google's massive data collection and clashes with advertisers over inappropriate content on YouTube.
Google, though, has increasingly linked together its services technologically through automated ad-buying tools that empower algorithms rather than humans to pick where ads are placed. Analysts were expecting US$25.55 billion, according to data compiled by Bloomberg.
TAC, an important metric in Google's ad business, crept up to 23% of ad revenue in Q2, up slightly from the 22% reported during the same period a year ago.
But those issues have yet to halt Alphabet, which has grown quarterly revenue at least 20 percent year-over-year for two straight years. In all, it's the same trend: it costs more to drive traffic to Google's advertising, and the cost per click is going down. Remove the fine and Alphabet's earnings rise to $11.75 per share and net income soars from $3.2 billion for the quarter up to $8.3 billion.
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Similarly, analysts don't expect European Union antitrust probes to force changes that significantly dent Google earnings.
On the company's conference call, CFO Ruth Porat said, "One of the biggest opportunities for investment continues to be our ads business, where we're continuing to invest meaningfully". Revenue rose 26% in the period to $32.7 billion, topping estimates. Some analysts excluded other items as well, and Alphabet also beat that consensus of $9.59.
But Alphabet's outlook is tempered by cost concerns, and Amazon.com Inc's encroachment into advertising has threatened Google's lucrative deals with media companies and advertisers.
Google chief executive Sundar Pichai said that it was too soon to speculate on how Android may be affected by the ruling but said the company would take a "constructive approach".
A logo is pictured at Google's European Engineering Center in Zurich, Switzerland July 19, 2018.