Published: Tue, July 24, 2018
Finance | By Jaime Brady

Google shrugs off $5.1 billion fine with another big quarter

Google shrugs off $5.1 billion fine with another big quarter

The internet giant on Monday reported second-quarter profit of $3.2 billion even after accounting for the fine, imposed by the European Union earlier this month for abusing its market dominance On a per-share basis, the Mountain View, California-based company said it had net income of $4.54.

Operating margin rose to 24 percent from 22 percent last quarter, excluding the $5 billion antitrust fine issued last week by the European Commission over Google's anticompetitive licensing of Android software.

Riding on Search engine and YouTube growth, Google's revenue jumped 26 per cent to $23.3 billion.

Shares of Google were up significantly after hours, rising 5 percent immediately after the numbers were released.

The EU fine followed an extensive investigation into the tech company's policy of forcing smartphone manufacturers to pre-install Google's search and browser apps on devices that use Android, its mobile operating system. Factoring out traffic-acquisition costs, revenue totaled $26.2 billion, above the $25.6 billion analysts had expected.

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"We delivered another quarter of very strong performance", chief financial officer Ruth Porat said.

For a company that was just hit with staggering $5 billion fine, Google and parent company Alphabet are as unbothered as ever.

Googlechief executive Sundar Pichai said that it was too soon to speculate on how Android may be affected by the ruling but said the company would take a "constructive approach". The average estimate of 13 analysts surveyed by Zacks Investment Research was for earnings of $9.45 per share. Sales from its "Other Bets", which include Google's cloud business and hardware division, rose almost 50 percent to $145 million.

"Google has to make sure their advertising clients are happy with the placement of their ads", he told Cheddar after the results. Other Bets posted Q2 revenue of $145 million on operating losses of $732 million ...

Some in the industry also cite GDPR, which convinced more advertisers to funnel ad spending to Google and its main rival Facebook Inc.

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