The profits of the alphabet lack expectations with the disappointment of cloud sales in Google
Alphabet, the parent company of Google, stated that sales that were not less than Wall Street, which have retracted the disappointed growth of the cloud computers department, which sells the company’s artificial intelligence tools to other companies.
Silicon Valley Giant has recorded revenues of $ 96.5 billion in the last quarter, an increase of 12 percent over the previous year, but less than 96.6 billion dollars expected by Wall Street analysts. The profit amounted to 26.5 billion dollars, an increase of 28 percent, which won the appreciation of analysts, with a small difference of $ 26 billion.
Google’s cloud department has become an essential component of the company’s transition to obstetric artificial intelligence, a technology that created a spending boom in and outside Silicon Valley. Google Cloud sales amounted to $ 11.96 billion in the fourth quarter, an increase of 30 percent over the previous year, but less than $ 12.2 billion expected by analysts.
The results raised questions about whether artificial intelligence will prove a feature for Google Cloud, which remains smaller than the competing services from Amazon and Microsoft. Alphabet has invested a huge amount to try to enhance their offers of artificial intelligence, amid fears of investors that American companies may spend a lot on artificial intelligence for their Chinese counterparts.
The Internet giant announced that it will spend $ 75 billion in capital expenditures in 2025, from 52.5 billion dollars last year, with a difference of more than $ 22 billion that could have been added to the company’s profits.
Alphabet shares fell about 7 percent in post -sales circulation.
The company’s executive officials said that strong spending was necessary, in contact with analysts after issuing the results. Anat Ashkenazi, the financial manager at Alphabet, said that Google Cloud has more demand for artificial intelligence tools more than the ability to provide customers with it. She added that the company is working hard to bring more capacity online and reduce restrictions.
Ms. Ashkenazi also warned that the growth rates of the Google cloud department may vary in 2025, as the company continues to buy more equipment and build more facilities. She added that she expects Alphabet expenses to range from $ 16 billion to $ 18 billion in the first quarter, and that the semester will change throughout the year.
Deepseek in the Chinese AI caused the fall of the American market last week after the Chatbot app rose in its popularity. Dibsic said it trained its system for only $ 6 million, which is a small part, which mastered technology giants such as Google Enved. Alphabet shares achieved great success, among others, although it later recovered. Since then, the informed of the technology industry questioned some Deepsik’s claims.
However, the episode highlighted the decisive need of Alphabet to obtain Amnesty International to properly maintain its digital services related to consumers and companies that were not more condemned to options. He added to questions about whether Google should consider embracing the so -called open source development used by Deepseek and other emerging companies of artificial intelligence.
“The disappointing results of Google indicate that the Acting Acts may begin to fade just as the closed Google strategy is a question by Deepseek,” Evelyn Mitchell Wolf, an Emarketer analyst, wrote in a note.
Sondar Pachai, CEO of Alphabet, praised Deepseek’s achievements on the call, but he said it is another evidence that artificial intelligence will provide enormous job opportunities in the future. He said that Alphabet was invested greatly to serve billions of consumers through its products and companies using its cloud technology.
Google search engine, which is seen as vulnerable to the transmission of artificial intelligence trends because Chatgpt from Openai took the world in a storm in 2022, holding so far. The most popular research product in the world, and in the fourth quarter, still achieved revenues of $ 54 billion. Analysts expected $ 53.4 billion.
As Alphabet continues to invest in artificial intelligence, it also continued in efforts to reduce other costs, including labor power discounts. Last week, the company said it has offered voluntary purchases for employees in the platforms and devices department, which is responsible for the Chrome web browser and pixel smartphones. The company also reduced nearly twenty roles in YouTube this week, according to an email seen in the New York Times.
YOUTube’s ads sales increased by 14 percent to $ 10.5 billion, above $ 10.2 billion expected by analysts.