Google’s parent has performance that is putting its Big Tech rivals to shame.
Alphabet reported huge beats on its top and bottom lines for its first quarter of 2021, as well as a new $50 billion stock buyback, which boosted the shares more than 4% in after-hours trading.
The company’s shares are poised for the longest string of monthly advances in over a decade, according to Bloomberg. Advertising revenue is driving them to the best returns among the largest US technology companies.
The gains have left Google shares with a return of 65% this year, far surpassing other technology giants and pushing its market capitalization close to $2 trillion. Only Apple and Microsoft are worth more.
Alphabet has benefited from a widespread recovery in the market for digital ads. Last month, it reported second-quarter results that surpassed analysts expectations as revenue surged.
“The most recent quarter was quite positive, and highlights that what’s behind the price momentum is real fundamental momentum,” said James Abate, chief investment officer at Centre Asset Management, which owns the stock. “Unless we see a break in margins moving higher or in the sales momentum, we are willing to live with a valuation that might look high relative to history.”
Google’s advance has easily eclipsed the moves in the shares of other massive Internet and technology companies, as well as the broader market indexes. The S&P 500 Index and Nasdaq 100 Index are both up about 21% this year. Microsoft and Facebook Inc. have risen more than 36% each, while Apple is up about 15%. Amazon.com Inc. has been the laggard among those valued at more than $1 trillion, up about 5% in 2021.
Google Cloud Revenue
Google Cloud revenue grew 53.9%, its fastest pace since Q3 FY 2019.42 Google Cloud is one of the tech giant’s primary business segments, the other being Google Services. The cloud segment provides developers with a highly scalable and reliable platform for building, testing, and deploying applications. It also offers workspace collaboration tools, including apps like Gmail, Docs, Drive, Calendar, Meet, and more.
As of the end of the first quarter of 2021, Google Cloud had an estimated 9% of the $150 billion global cloud market, ranking it third behind Microsoft Corporation’s Azure and top-ranked Amazon Web Services.
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