Alphabet三季度营收利润不及预期，谷歌云收入超预期

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This is a breaking news update from Bloomberg. Instant reaction and analysis from our 3,000 journalists and analysts around the world. I'm going to go to Alphabet. Third quarter, uh, Google search and other revenue, uh, that is coming in a little light. 63.35 billion. The street estimate was 64.85 billion. Google search, uh, Google services revenue that came in light, 96.3 versus 98.4, the estimate on the street. Third quarter cap X 51.36 billion.

That's below the street estimate of 55 uh.78 billion. I'm taking a look at Google shares. Yeah, they are falling in the aftermarket. So, we are actually seeing some disappointment in terms of some of the numbers. Third quarter revenue XTAC uh an important number here 111.21 billion slightly light the street looking for 111.29 billion. Third quarter Google cloud revenue uh that came in better slightly 30.71 billion versus an estimate of 29.1 billion.

Here's a number. Gemini app has reached 1 billion users.

Yeah. Um also the tokens number here.

What's the token?

This is This is pretty wild. Um, Alphabet is now talking about processing about 32 billion tokens per minute. That's the model APIs. Alphabet says Alphabet also surpassing 150 million YouTube music and premium subs. And Carol, that now turning into a redhead. Gemini app has reached 1 billion users. Third quarter cloud revenue coming in just above estimates at $3.71 billion.

Investors definitely not impressed. Our Ed Lello, host of Bloomberg Tech on Bloomberg TV is with us. Uh I know Ed, you've been listening, we're watching um continuing to see pressure on uh Alphabet. Julia Love and Dave Alba with a right through from the Bloomberg news team writing that the quarterly sales and profit for the company fell short of expectations. A sign that the company is failing to generate enough return to justify its massive investments in AI.

Your quick take on the topline miss and the bottom line miss. Was the topline miss an indication to you that search is being cannibalized a little bit?

Yeah.

By these LLM finally.

Yeah. I mean the data doesn't answer your question. So like Google search is really mixed. Overall search revenue missed by about $1.5 billion which is which is a significant miss right in this environment against Wall Street consensus. um but informed by what they were talking about last quarter. But you know Google says very explicitly that AI is driving growth in search queries. Um so the use like people going to search is getting a benefit from AI but for in terms of revenue like the the monetizable amount you know it's not in line with expectations.

It's growing 12%. You know it's hard. I don't know the answer. Sorry. So where's the connect?

But so but Ed, this is I mean this is the golden goose. This is what Larry and Sergey invented, you know, decades ago, a better way to give us information and then sell it next to companies that want to reach you. And I would argue that out of Silicon Valley, the only company that's perhaps done a better job doing that is Mark Zuckerberg's company. But for search, Alphabet owns it. This is their business. And the concern a year ago or 18 months ago was that the LLMs would eat into that.

And we got over the last few quarters an indication that that wasn't happening. Everyone was like, "Oh, don't freak out. We're going to be fine."

Does it seem like it's going to be fine? Because if people are still getting the answer they want,

but Alphabet's not monetizing it the way that they're used to, then that could be an issue.

So, so search is still the golden goose. And from a scale perspective, like in the quarter, it's more than half of revenue. So that the the AI question matters is the action that this company's taken which is putting AI overviews or AI mode in search. They're saying that it is increased use of search but are they able to increase usage without damaging monet monetization? We don't have a conclusive answer based on the fact that search revenue is overall missed.

But you you'd bet, wouldn't you, that the the analysts will ask exactly that question on the call. Okay, Google or Alphabet Management search is up but but the financials of this are changing. Explain that to us.

Right. Yeah.

And it goes to that bigger question, right? We still think about this company as a search engine company and how is AI changing it? Is it giving it increased ROI to some extent, right, on its main business? Like whether or not they're seeing the payoff from all this investment. It kind of is as simple as that. Yeah, I would say like you know search grew 12%. But search revenues did not grow 12%. What's up with that?

Pretty simple. I I would also say by you know like there's another part of the business which is advertising, right? And advertising also missed by like well above a $1.5 billion as well. So like something's going on there in in the the advertising broadly. Um

yeah, sorry.

Yeah, those two businesses inextricably linked. I mean I I think that the the the challenge here is like to me Ed this seems existential. I mean there was a business we cover about this a year ago that and I and I Julia Love worked on this story and it was all about how Alphabet was trying to adapt Google and search for the next generation. We spoke to a small business owner last week who has had to completely

uh change her business and it's getting killed as a result of the changes that Google has made. She's now trying to optimize for the LLMs. Christina Stemble of Farm Girl Flowers

because her search queries

because the search queries