Alphabet 2Q earnings: Here’s what to expect

Google's attempt to settle its antitrust case in Europe was too little and too late

Alphabet's quarterly profits fall after $5 billion EU fine

Alphabet generated revenue of $32.66 billion during the second quarter of 2018, compared to $26.01 billion during the same quarter a year ago.

The sums Google pays out to websites and mobile partners to distribute its search engine and ads - called Traffic Acquisition Costs - also rose to US$6.4 billion for the quarter.

Net profit dropped to $3.2 billion from $3.5 billion, due to the fine, but analysts focused on operating results.

"We delivered another quarter of very strong performance, with revenues of $32.7 billion, up 26 per cent versus the second quarter of 2017 and 23 per cent on a constant currency basis", Ruth Porat, CFO of Alphabet, said in a statement. Analysts estimated $9.52 per share, according to research aggregated by Thomson Reuters.

Revenue growth has accelerated from the 21% rate of a year ago, thanks in part to an increase in the number of paid clicks, which rose 58% from the year-ago quarter.

'Our investments are driving great experiences for users, strong results for advertisers and new business opportunities for Google and Alphabet'. Oddly enough, however, Alphabet isn't spending much money to get those groups going - capital expenditures for Other Bets was a puny $10 million for the quarter, compared to $148 million a year ago.

The rest of the revenue came from Google's non-advertising businesses, which include selling apps, gadgets and cloud computing services, and ventures such as offering internet service. So it appears that the firms are essentially neck-and-neck from an earnings perspective now, despite Microsoft's incredible YOY gains: Factor out Google's antitrust fine, and those results are almost identical. CEO Sundar Pichai reiterated that the company plans to appeal the decision.

Alphabet's stock price is right now sitting at $1,255 apiece, up 3.6 per cent in after-hours trading. Google may need to rethink its business arrangements with smartphone companies, it added.

Reacting to another monster quarter from Google parent Alphabet Inc., a CNBC analyst wondered out loud if the tech giant has become more powerful than the US government.

Company shares have benefited from easing regulatory concerns. In the last quarter, Google opened regions in Los Angeles and Finland and announced a new region in Zurich.

A logo is pictured at Google's European Engineering Center in Zurich, Switzerland July 19, 2018.

Business Insider has contacted Google for comment.

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