Google parent Alphabet posts first revenue decline in company history

Google CEO Sundar Pichai testifies remotely during a House Judiciary subcommittee hearing on antitrust on Capitol Hill on Wednesday

Google CEO Sundar Pichai testifies remotely during a House Judiciary subcommittee hearing on antitrust on Capitol Hill on Wednesday

However, despite the decline in its revenue the company managed to beat Wall Street's revenue expectations. The company's stock barely moved after hours.

Alphabet shares were barely changed at US$1,552, above their pre-pandemic high, after it said revenue fell 2 percent in the second quarter, less than analysts' estimate of a 4 percent decline.

Google saw a "modest" improvement in ad-sales trends in July, but "it's premature to say we're out of the woods" given macroeconomic uncertainty, Alphabet and Google CFO Ruth Porat said on the company's earnings call.

Parent company Alphabet reported revenue of $31.6 billion (minus traffic acquisition costs) with earnings per share of $10.13.

Amid the relative advertising weakness, other lines of business - including YouTube subscriptions, Google Play and Google Cloud - grew to help offset the decline, according to Alphabet/Google CEO Sundar Pichai.

"We are cautiously encouraged by our results for the second quarter, although mindful of the fragile global economic environment", Porat said.

Trump floats idea of election delay
However, there is no evidence of widespread fraud, according to numerous nationwide and state-level studies over the years. Earlier, the president suggested that increased postal voting could lead to fraud and inaccurate results.

As a result of the customer pullbacks amid the Covid-19 pandemic and the general maturing ad market, Alphabet itself cut marketing spending by half and instituted hiring freezes for the second half of the year in anticipation of a slowdown, CNBC reported.

Alphabet revenue dropped 2% from past year, the company announced in second-quarter earnings Thursday, beating Wall Street expectations a day after Google CEO Sundar Pichai appeared before the House Judiciary antitrust subcommittee to face allegations of anticompetitive behavior. That rate of growth was lower than the 52% the business saw in the first quarter.

One of the main offenders this time around was Google's core search and ad revenue, which was down 9.8% year over year. The Other Bets showed an operating loss of $1.11 billion during the quarter.

"Although we still expect the pace of headcount growth to decelerate somewhat in 2020, we're continuing to hire aggressively in priority areas like cloud", Porat said. Google ended the quarter with 127,498 employees, up 18% from the quarter a year earlier.

Pichai and the CEOs of Apple, Amazon and Facebook yesterday were grilled by US congressmen during a hearing on their online platforms' market power and dominance held by the House Committee on the Judiciary's Subcommittee on Antitrust, Commercial and Administrative Law.

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