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TECHNOLOGY A23
                                                                                                                  Tuesday 2 February 2016

Google parent tops Apple as world’s most valuable company 

MICHAEL LIEDTKE                 In this Nov. 12, 2015, file photo, a man walks past a building on the Google campus in Mountain                                       ways been a little muddy,”
AP Technology Writer            View, Calif. Alphabet Inc., Google’s holding company, reports financial results Monday, Feb. 1,                                       said Edward Jones analyst
SAN FRANCISCO (AP) —            2016.                                                                                                                                 Josh Olson. “The hope now
Alphabet, Google’s new                                                                                                                                                is that management will
parent company, topped                                                                                                                              Associated Press  continue to show greater
Apple as the world’s most                                                                                                                                             cost discipline.”
valuable  business  in after-   drivers to curing cancer.        loss of $1.2 billion on rev-     Under the previous setup                                            Google is also counting
hours trading Monday af-        Until now, the expenses of       enue of just $151 million.       at Google, “things had al-                                          on advertisers to gradu-
ter reporting surging earn-     running those peripheral         Alphabet labels that cate-                                                                           ally pay more for market-
ings.                           operations had been hid-         gory “other bets.” That loss                                                                         ing messages on smart-
Alphabet Inc. earned $4.9       den in Google’s financial        also excluded employee                                                                               phones. They still aren’t
billion in net income on        statement. The company’s         stock expenses.                                                                                      paying as much for mobile
revenue of $21.3 billion in     opaque accounting made           The optimism surround-                                                                               ads as on personal com-
the fourth quarter. If not for  it difficult to know just how    ing Alphabet stems in part                                                                           puters because the smaller
employee stock expenses         much profit Google reaped        from hopes that the com-                                                                             screens on smartphones
and certain other items,        from its primary business —      pany is developing more                                                                              have been seen as an im-
Google said it would have       selling digital ads next to      financial discipline as it dis-                                                                      pediment. That’s one rea-
earned $8.67 per share.         everything from search re-       closes more earnings de-                                                                             son Google’s average ad
That figure easily topped       sults to YouTube videos.         tails. Google had become                                                                             rates, measured as “cost
the average estimate of         In the fourth quarter,           known for its free-spending                                                                          per click,” have been de-
$8.10 per share among an-       Google produced an op-           habits and reluctance to                                                                             clining for more than four
alysts surveyed by FactSet.     erating profit of $6.8 billion,  share information with ana-                                                                          years.
The earnings report pro-        excluding employee stock         lysts.                                                                                               In the latest quarter,
vided the most detailed         expenses, on revenue of          The change in sentiment                                                                              Google’s cost per click
breakdown yet on the            $17.1 billion, after subtract-   coincided with Google’s                                                                              fell by 13 percent from the
profits pouring in from         ing ad commissions. That         hiring of a new chief finan-                                                                         same time in 2014. But Po-
Google’s dominant search        translates into a whopping       cial officer, Ruth Porat, last                                                                       rat cited in increase in mo-
engine and ad network.          profit margin of 40 percent.     May. Porat, a Wall Street                                                                            bile search requests as one
(Google reorganized itself      Meanwhile, Alphabet’s            veteran, has consistently                                                                            of biggest reasons that
under Alphabet last Octo-       other companies together         signaled her intent to rein in                                                                       Google’s revenue rose by
ber.) Investors pushed up       produced an operating            spending.                                                                                            18 percent from the pre-
Alphabet stock $44.23, or                                                                                                                                             vious year. As people in-
more than 5 percent, to                                                                                                                                               creasingly search for infor-
$815 in extended trading.                                                                                                                                             mation and shop on their
Based on that after-hours                                                                                                                                             phones, the company ex-
bump, Alphabet surpassed                                                                                                                                              pects advertisers to ramp
Apple as the world’s most                                                                                                                                             up their spending on smart-
valuable publicly traded                                                                                                                                              phones, too.q
company. According to
calculations from S&P In-
dices, Alphabet was worth
$571 billion versus $538 bil-
lion for Apple.
 That ranking, of course,
could shift again in regular
trading Tuesday.
Apple’s stock has been
sliding amid concerns
about a slowdown in
iPhone sales. Alphabet’s
stock has surged by 45 per-
cent since the end of 2014
when it was still trading un-
der Google’s name.
The fourth-quarter report
marks the first time Alpha-
bet has spelled out the
costs of running still-exper-
imental  businesses  that
are trying to do everything
from eliminating human
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