Shares of Alphabet Inc. GOOGL dipped almost 2% on Monday, just a few trading periods before Google’s parent company is scheduled to release its Q3 earnings.
As we approach Alphabet’s report date, analysts and investors should begin to hone in on what to expect from the company’s Q3 results while trying to drown out the negative noise surrounding the new Pixel 2 smartphone.
GOOGL has climbed nearly 27% this year, spurred in part by growth in new business segments. Still, a few days out from Alphabet’s third-quarter earnings report, our current consensus estimates call for earnings to fall 7.4% to $8.39 per share. Luckily for investors, the company’s revenues are projected to jump 20.1% to $21.94 billion.
But earnings and revenues are just two of the many different things investors will be focused on come Thursday. While Alphabet has invested in artificial intelligence, cloud computing, ecommerce, and mobile payments, its core business is still its ubiquitous search engine and the billions of advertising dollars that it generates, so we’ll be particularly interested in seeing how this segment performed.
Not too long ago, investors worried that Google’s search-related revenues would be hampered by the massive shift to mobile. This concern stemmed from the simple fact that advertiser’s do not currently value mobile ads and clicks as much as they do traditional web advertising.
Today, this fear has been curbed because Google’s overall growth in total paid clicks has skyrocketed high enough to outweigh lower mobile cost-per-click rates. Last quarter, Alphabet’s advertising revenues grew 18.4%, which topped our consensus estimate.
This quarter, total paid clicks growth is set to help Google’s advertising revenues soar by over 18%, according to our exclusive non-financial metrics consensus estimate file.
These important stock drivers are from our exclusive non-financial metrics consensus estimate file. These estimates are updated daily and are based on the independent research of expert stock analysts. Learn more here>>>
If Google proves it can still command a hefty amount of advertising dollars when it reports earnings on Thursday, investors should be elated, as it gives Alphabet the capital to experiment and invest more heavily in the future while its cash cow keeps climbing.
For more stock-moving estimates ahead of Alphabet’s Q3 report, check out our full guide: 3 Key Estimates for Google's Q3 Earnings Report
And make sure to check back here for our full analysis of Alphabet’s actual results later this week!
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