Google's parent Alphabet Inc announced its fourth-quarter results and the profits remain below analysts’ estimates on Thursday, mostly because of the higher tax rate, the analysts also cheered that the company branching out into other businesses that go beyond advertising.
Advertising still accounts for the most of the Google’s revenue, by helping it grow, 17.4 percent to $22.4 billion in the quarter, Alphabet’s Chief Financial Officer Ruth Porat said that Alphabet if broadening its business, pointing towards the growth in hardware, cloud business and app sales.
The other businesses went up by 63 percent to $3.4 billion. “We see tremendous potential ahead for these businesses, as well as in the continued development of non-advertising revenue streams for YouTube,” Porat said on a call with investors.
Google’s hardware showed growth as Google Home, a smart speaker and the Pixel smartphone gained interest, especially during the holiday season. Google Chief Executive Sundar Pichai said during the call.
“We’re committed to this for the long term as a great way to bring a beautiful, seamless Google experience to people,” he said.
The company posted a 22.2 percent increase in quarterly revenue. Reuters reports that it could be the advertisers that spend more to reach an expanding user base that spends more time on smartphones and YouTube.
Alphabet, has a huge window in 2017 since its hardware is only now picking up traction. And will be easily able to reclaim its position as the most valuable company in the world. Which the company held for a brief moment over Apple. Apple’s growth strategy plan slowed down in 2016. While the company said that it would bounce back with the release of iPhone 7 and the other products.