ChatGPT Who? Alphabet Rallies on Strong Search Performance
Alphabet (GOOGL:US) shares were up 6% after the Google parent reported second-quarter results that topped analyst expectations. Shares were also boosted by the announced plans for a transition of its well-respected chief financial officer Ruth Porat.
For the second quarter, the company reported revenue of $74.60 billion, easily ahead of the expected $72.77 billion. Google's advertising business saw its sales rise to $58.14 billion. All business segments – including Cloud and YouTube – topped analyst expectations.
"Our continued leadership in AI and our excellence in engineering and innovation are driving the next evolution of Search, and improving all our services," Alphabet and Google CEO Sundar Pichai said in a statement. "With fifteen products that each serve half a billion people, and six that serve over two billion each, we have so many opportunities to deliver on our mission."
Still, Google’s core search business excelled once again while the company also felt a meaningful boost to its operating profits from YouTube subscriptions. The operating margin beat analyst expectations by 140 basis points as it came in at 29%.
In other news, Google said its CFO Porat will become the new President and Chief Investment Officer, hence occupying this newly-created role starting from September 1, 2023.
Porat is one of the most respected CFOs on the Street, hence the positive marker reaction to this news. She will continue to serve as CFO while the company searches for and selects her successor.
The surge in Alphabet stock comes just a few days after Congressman Michael McCaul disclosed he was selling shares in early June when they traded near the $120 mark. His colleagues Ro Khanna and Josh Gottheimer were also sellers of the stock in recent weeks.
