Alphabet profits dragged down by Google's £2.1bn EU fine
Shares in Google's parent company Alphabet reversed earlier gains on Monday evening, as the tech giant's profit took a hit from the record EU fine imposed on the group earlier this year.
Alphabet said its earnings per share (EPS) came in at $5.01 (£3.85) for the three months to June 30, compared to analyst expectations for $4.49, while revenue rose 21pc to $26bn, ahead of forecasts for $25.6bn.
Revenue from the largest chunk of Alphabet's business, Google, rose to $25.8bn from $21.3bn a year earlier, thanks to an 18pc boost from advertising revenue.
The quarter saw a 52pc year-on-year rise in paid clicks, where advertisers only pay for the adverts users clicked on, with the increase ahead of analyst expectations.
Alphabet's other businesses, including the Nest smart home devices unit, meanwhile, saw revenue rise to $248m from $185m a year earlier.
However, the group's overall net income fell 28pc to $3.5bn from $4.9bn a year earlier, after Google was hit by a record $2.74bn fine from the European Commission following a seven-year investigation into claims the technology giant abused its internet search monopoly.
Google and tech company fines
The fine had been the biggest ever competition fine from the European Commission and was double the size of the previous record fine handed to Intel in 2009. Alphabet is considering an appeal.
Shares in Alphabet dropped 3.5pc in after-hours trading, reversing gains made earlier in the day.
Immediately ahead of the results, Alphabet had been trading up 1.1pc on the news it was appointing Google chief executive Sundar Pichai to its board of directors.
Mr Pichai was named as the head of Google in August 2015 when the group restructured itself into the Alphabet company, separating out the search engine and Android operating system from its other non-core divisions.
Prior to that, he had worked at Google for more than a decade.
