Alphabet, the parent company of Google, said revenues for its fourth quarter rose 24 percent from the year before to USD 32.323 billion. The net result however came under pressure from the effects of the Tax Act enacted in the US on 22 December. This resulted in additional tax expenses of USD 9.9 billion in the quarter, mainly from a one-off due to accumulated foreign subsidiary earnings and deferred tax impacts. As a result, the net loss came out at USD 3.020 billion, from a gain the year before of 5.333 billion. Without the impact of the new tax law, profit would have amounted to USD 6.837 billion. The diluted loss per share went to USD 4.35, from earnings the year before of 7.56.
CFO Ruth Porat said the operating profit growth to USD 7.664 billion from 6.639 billion underscored Alphabet’s core strength and that the company would continue its strategy of making substantial investments for the long-term in new businesses.
For the full year, revenues lifted 23 percent to USD 110.9 billion, with the net profit slipping to USD 12.662 billion from 19.478 billion year-on-year. The operating profit meanwhile went up to USD 26.146 billion from 23.716 billion.
Revenues at the Google segment advanced to USD 31.914 billion from 25.802 billion, with the operating profit rising to USD 8.763 billion from 7.883 billion. Revenues at 'other bets' lifted to USD 409 million from 262 million with the operating loss narrowing to USD 916 million from a loss the year earlier of 1.088 billion. Advertising revenues also showed a strong increase, going higher to USD 27.227 billion from 22.399 billion.
Alphabet ended the quarter with USD 101.871 billion in cash, against 100.14 billion at the end of September. The number of employees continued to grow, rising to 80,110 from 72,053 the year before and 78,100 in the previous quarter. Capex for the quarter went to a record USD 4.31 billion.
Google also announced a new share buyback programme for up to 8.59 billion worth of shares. Also, Alphabet’s board appointed John Hennessy to serve as its chair. Hennessy has been a board member since April 2004 and lead independent director since April 2007.
