Alphabet shares rise as Google search boosts profits

Digest opened free editor

Rola Khaleda, FT editor, chooses her favorite stories in this weekly newsletter.

Alphabet shares increased after they reported 46 percent of the first quarter profits, driven by another good performance in research and prosperity in the demand related to artificial intelligence on cloud computing.

The net income jumped to 34.5 billion dollars compared to 23.7 billion dollars in the same period of three months in the previous year, the parent company of Google said on Thursday, which helped calm concerns about its ability to overcome a trade war and American stagnation.

The basic research and announcement of Google grew by 10 percent to $ 50.7 billion in this quarter, exceeding estimates ranging between 8 and 9 percent.

The numbers gave comfort to investors who were closely monitoring any softness in the research – which represents 56 percent of the group’s revenues – due to the popularity of Chatbots AI such as Openai’s Chatgpt, Anthropic’s Clauds and Elon Musk’s Grok.

They were also alert for evidence that Google Gemini Chatbot answers and artificial intelligence summaries are to stimulate these basic works by reducing the number of user clicks on ads.

“The research has witnessed a strong growth in strong growth, supported by the participation we see with features such as an artificial intelligence overview,” said CEO Sondar Bishy, ​​referring to the answers created by artificial intelligence that now appears at the highest of many results pages. “We tend here so much, continue to get rid of the feature in new countries, more users and more inquiries.”

“We see that it is almost at the same rate,” said the chief business official, Philip Schindler.

Jeffrey Brent analyst said the results “better than fear, with health and cloud ads.” He had previously warned that “the macroeconomic and definitions [would] During the second and third quarter “and that the advertisement” faces the opposite winds “where Chinese sellers reduce spending.

Alphabet shares increased by more than 4 percent in post -market trading. The company said it would buy $ 70 billion in shares, the same amount it represented last year.

Google is the second large technical company to report profits in the wake of the World Trade War of US president Donald Trump. The shares of the alphabet decreased by 17 percent this year. Like most of its competitors, the company was affected by concerns about the definitions that disrupt supply chains and softening consumer spending, enhancing fears of American recession.

“It is clear that we are not immune from the total environment,” said Shendler.

This month, the White House raised duties on small packages, which were previously exempt if its value was less than $ 800. This caused the Chinese and Shein e -commerce trade to reduce spending on digital ads such as Google and Meta.

Shendler said that the change of policy “will lead to a slight wind of our advertising business in 2025, especially from retailers in the Asians.”

Earlier this week, Tesla warned that the customs tariff would have a “great” impact on the battery -based battery works. CEO Elon Musk pledged to continue to pressure Trump in favor of free trade principles.

But the total revenue of Alphabet increased by 12 percent to 90.2 billion dollars in the three months until the end of March, overcoming consensus expectations for $ 89.2 billion, according to Capital IQ.

Its cloud computing department recorded an increase in revenue by 28 percent to 12.3 billion dollars, indicating a continuous appetite for the data center and network services from the mutation in artificial intelligence. However, this slowed from 30.1 percent in the previous quarter, which blamed the alphabet for the demand for the offer as the number of new data centers over the Internet exceeds.

Standard spending in Alphabet continued on data centers, potatoes and other Amnesty International’s infrastructure in the increase. Capital spending jumped in the first quarter to 17.2 billion dollars, up from $ 12 billion last year and a little more than $ 17.1 billion. The spending is expected to reach $ 75 billion this year, up from $ 53 billion in 2024.

The company is still facing challenges after it has lost a series of anti -monopoly cases brought by American organizers against companies searching for its search, digital ads and application store. It can be forced to sell the Chrome browser, end an exclusive partnership for the Apple search engine and share more data with its competitors.