What you need to know
- Alphabet reported its Q2 2022 financial earnings on Tuesday.
- The company reported a 13% year-over-year growth, a significant decrease from last year’s 62% growth during the same quarter.
- Google recently announced that it was slowing down hiring for the remainder of the year with a temporary two-week pause.
Google’s parent company, Alphabet, announced its Q2 2022 financial earnings on Tuesday, reporting $69.69 billion in revenue. This is a 13% year-over-year growth compared to the same quarter in 2021, although a large decrease compared to the 62% growth witnessed in that quarter.
As a result of slowed growth, the company missed analyst expectations of $69.9 billion (via CNBC). YouTube, often a bright spot for the company, also missed analyst projections, bringing in $7.34 billion vs. an expected $7.52 billion.
Alphabet CEO Sundar Pichai points to Search as a major driver for Q2, while putting a positive spin on the company’s Cloud business. Google Cloud continues to lose money, but revenue continues to grow compared to the previous quarter and the same quarter last year. However, it still narrowly missed revenue expectations for the quarter, with a reported $6.28 billion vs. 6.41 billion expected.
“In the second quarter our performance was driven by Search and Cloud,” Pichai said in a statement. “The investments we’ve made over the years in AI and computing are helping to make our services particularly valuable for consumers, and highly effective for businesses of all sizes. As we sharpen our focus, we’ll continue to invest responsibly in deep computer science for the long-term.”
As far as sharpening its focus, the company recently announced that it was slowing down hiring for the remainder of the year as it focuses on “streamlining processes.” Part of that slowdown involves a two-week hiring pause allowing teams to “prioritize their roles and hiring plans.”
Jesse Cohen, senior analyst at Investing.com, comments on the report, which sent the company’s stock up in after-hours trading.
“Alphabet delivered a disappointing quarter with the search giant underperforming our expectations across almost all business units. Despite the underwhelming quarter, expectations were so low that investors blew a sigh of relief, sending the stock higher. With a relatively low price-to-earnings ratio of 20, Alphabet remains one of the cheapest of the megacap tech companies from a valuation perspective.”