Google has reported soaring annual revenue of $74bn for 2015, up from $65bn a year earlier, after strong advertising growth.
The hike helped Google parent Alphabet to become the most valuable company in the world at $570bn, trumping Apple’s market value of $538bn.
Google’s fourth-quarter and full-year results for 2015 show that annual operating income rose from $19bn in 2014 to $23bn in 2015 after a healthy increase in advertising revenue. The fourth quarter brought saw Google bring in $14.9bn in revenue across all Google website, a rise of 20 percent on the same quarter in 2014.
Alphabet's financial results were revealed for the first time since it was set up as the parent company for Google and its other subsidiaries.
Alphabet pulled in $21bn in revenue in the quarter, an increase of 18 percent over the same period 12 months earlier. This generated net a profit of $4.9bn, a 25 percent increase over last year.
However, the results also show that on a 12-month basis, Alphabet’s Other Bets division, which includes the X research and development business unit, cost the company a hefty $3.5bn, indicating that Alphabet’s investments in technologies such as driverless car systems come with a huge development cost.
Other Bets losses were nearly double the $1.9bn in 2014. Ruth Porat, Alphabet’s chief financial officer, put the losses down to the variation and early stages of the projects falling under this banner.
“Keep in mind that Other Bets represents an aggregation of businesses, many of which operate in distinct sectors with different business models,” she said in an earnings call transcribed by Seeking Alpha.
“Given their stages of development, these businesses will have idiosyncrasies with respect to the timing of revenue, expenses and [capital expenditure] resulting from milestones, partnerships and other factors.
“You can expect that results for the combined Other Bets may be uneven in the near term, so it's likely to be more instructive to look at them on an annual or rolling 12-month basis to assess their trajectory.”
Nevertheless, when combined with Google, Alphabet is the most valuable company in the world, sitting on top of a list technology behemoths like Apple, Facebook and Microsoft.
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