Alphabet stock falls over 10% to $289.95 after Q3 earnings miss

Alphabet fell short of Wall Street expectations in the third quarter, even though revenue grew 25%. The shares slid by over 10% to reach $289.95 after hours on Wednesday, as first reported by The Economic Times.

Revenue was $127.58 billion, up 25% year on year. A FactSet poll had expected $127.97 billion. Net income was $26.17 billion, down from $34.98 billion a year earlier. Earnings per share were $2.12, against about $3.01 expected. An $8.7 billion loss on equity investments cut EPS by 55 cents.

Google Cloud was the bright spot. Its revenue rose 103% to $30.7 billion. Search and other revenue rose 12% to $63.3 billion, and YouTube ads rose 9% to $11.2 billion. That was lower than some analysts expected, even though Sundar Pichai, CEO of Google and Alphabet, said query growth was the highest in five years. Pichai said Alphabet is "now on a half-trillion dollar revenue run rate. Our deep full stack approach is driving momentum across the business,"

Analyst David Wagner of Aptus Capital Advisors said: "In a market worried about AI cannibalizing the franchise, investors need to see Search accelerating, not decelerating," Anat Ashkenazi, Chief Financial Officer of Google and Alphabet, said capex will "increase significantly". NDTV Profit reported that Nasdaq 100 futures were down 1.06% to 29,663.