Alphabet, the parent company of Google, reported a strong increase in third-quarter profits, led by continued expansion in Google's advertising business. Revenues rose 20 percent year-on-year to USD 22.45 billion, and operating profit increased to USD 5.77 billion from USD 4.71 billion, leading to an increase in the margin to 34 percent from 33 a year ago. Net profit rose to USD 5.06 billion or USD 7.25 per share, from USD 3.98 billion or USD 5.73 per share a year earlier.
Google led the growth, with an 18 percent increase in advertising revenues and 23 percent growth in revenue from its own websites. Paid clicks were up 33 percent, while the cost per click fell 11 percent. Traffic acquisition costs were stable as a percentage of revenue, at 21 percent.
The company's 'other bets' contributed an operating loss of USD 865 million on revenues of USD 197 million. That's better than a loss of USD 980 million on revenues of USD 141 million in Q3 2015.
Alphabet increased capital expenditure slightly to USD 2.55 billion in Q3, but free cash flow still more than doubled to USD 7.29 billion from USD 3.76 billion a year ago. The company ended the quarter with over USD 83 billion in cash and just under 70,000 employees.
