Yesterday marked the earnings call for the parent company of Google, Alphabet. It posted a 25% rise in revenue quarter on quarter, shrugging off the $5 billion EU fine. Due to the fine, Alphabet reported two different profit figures in its earnings call. Excluding that, Alphabet said profit was $11.75 a share. Google plans to appeal against the EU ruling. Even including the record fine, the company generated $3.2 billion in net income during the second quarter.
What is more interesting is Sundar Pichai’s comments on Google’s Android strategy post the EU fine. Many publications noted that the fine could potentially mean drastic changes in how Android worked, but Sundar does not believe so. Sundar suggested that the company is not planning on dramatically altering its Android strategy.
“I’m confident that we can find a way to make sure Android is available at scale to users everywhere.” — Sundar Pichai
He added that Google gives Android to smartphone makers for free, which is part of the reason it’s the most popular mobile operating system. This means that for the foreseeable future, Android will continue to remain free, while Google works on its new Fuchsia OS.
The cash cow, that is the advertising business grew 24 percent, which pushed total revenue to $26.24 billion during the second quarter. This beats analyst estimates by around seven percent.
Advertisers are spending more on Google products versus other websites
A large share of Google’s ad dollars went to its own digital properties, including the search engine and YouTube, rather than outside websites that run its ads. The revenue from Search and YouTube jumped 26 percent this quarter, up to $23.3 billion. Google is offering advertisers a packaged deal with all their properties, which is attracting more advertisers.
Apart from that, revenue from its hardware (Pixel lineup) and cloud service (Google Cloud) grew 37 percent to $4.4 billion in the second quarter.
