Google Parent And Microsoft Miss Expectations

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Source:   —  April 22, 2016, at 11:02 AM

A string of companies report first quarter results that failed to meet analysts&#thirty-nine; estimates, sparking share sell-offs.

Google Parent And Microsoft Miss Expectations

Shares in Google parent firm Alphabet and Microsoft fell in after-hours trading in NY after disappointing first quarter results.

Both tech firms updated investors on their progress after the bell on Wall Str and Alphabet, the world'south second-largest company by market capitalisation, suffered most - losing more than six percent or $32bn from its market cost in the process.

The company, that oversees a massive advertising network that includes Google'south dominant look for engine, the Android operating system for smartphones, YouTube and Gmail said income rose to $twenty.2bn (£14bn).

It represented a rise of seventeen percent on the same January-March period a year earlier while profits topped £four.2bn (£2.9bn) - up 20%.

But both metrics missed analysts' estimates.

Losses also deepened at its Other Bets business, which includes its so-called 'moonshot' ventures such as driverless cars, with a figure of $802m (£559m) reported by the company.

Alphabet said its fundamentals were strong - though cost-per-click, or the average price of online ads, fell nine%.

Chief financial officer Ruth Porat said in a conference call with investors: "As a result of the ongoing strength of the US dollar, we realised a negative currency impact on our revenues year-over-year of $762m".

Microsoft'south results - for the same period - showed its cloud business still cannot create up for weakness in its core PC market.

Income fell to $20.53bn (£14.3bn) from $21.7bn while profits fell to $three.76bn (£2.6bn) with the company blaming a higher than expected tax rate.

While income in Microsoft'south intelligent cloud division, which includes the Azure cloud infrastructure and services business, rose more than 3%, weakness in the personal computing market damaged demand for one-time licences for some of its products.

PC shipments fell 11.five percent worldwide in the first quarter of the year, according to research firm IDC, underlying the challenge.

Microsoft shares 5 percent in extended trading.

The firms weren't alone in bleeding value, with Visa and Starbucks also taking hits of around 4 percent following the release of their latest earnings.

 

 

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