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3 February, 2018 00:00 00 AM
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Google parent hit by higher costs, names new chairman

AFP
Google parent hit by higher costs, names new chairman
The file photo shows a woman sits in a Las Vegas Monorail car with a Google ad prior to the CES 2018 on January 7 in Las Vegas, Nevada. AFP Photo

AFP, SAN FRANCISCO: Google parent company Alphabet on Thursday reported a quarterly loss to set aside funds to pay taxes on repatriated profits, and named a new chairman to replace outgoing Eric Schmidt.

Shares in Alphabet slid 2.3 per cent in after-hours trade on the results, highlighting concerns about rising costs for the online giant and profits weaker than expected.

Alphabet reported a loss of $3 billion for the fourth quarter as it set aside $11 billion for taxes. An estimated $9.9 billion was for taxes on repatriated

earnings.

The California tech giant said revenues in the last three months of 2017 rose 24 per cent from a year ago to $32.3 billion and cited “great growth” for the company.

The company used the earnings report to announce it had named board member and former Stanford University president John Hennessy as chairman, replacing Schmidt, who announced his departure in December.

Hennessy has been a board member since 2004 and lead independent director since April 2007.

In the earnings report, Google remained the key driver of revenue and profit for the company, which has reorganized into new divisions for self-driving vehicles, life sciences and other so-called “moonshot” projects.

The Google segment accounted for $31.9 billion in revenue and delivered an operating profit of $8.8 billion.

”Overall, we are interpreting the quarter’s results favorably if only because they were ahead of our conservative expectations,” Pivotal Research group senior research analyst Brian Wieser said in a note to investors.

”Alphabet reported good 4Q17 results which were generally consistent with our long-term views on the company.”

Excluding the tax provision—following the lead of other

multinationals taking advantage of a favorable rate to

repatriate earnings—Alphabet would have posted a profit of $6.8 billion.

”Our momentum reflects a relentless focus on users, advertisers and enterprise customers, as well as the benefits of our commitment to long-term investing,” chief financial officer Ruth Porat said.

Porat said Alphabet was pleased with the progress of its “other bets,” which include the life sciences unit Verily and a new cybersecurity division called Chronicle.

The units, born of an X lab devoted to “moonshots,” delivered revenue of $409 million, up from $262 million a year earlier. The loss from those projects narrowed to $916 million from $1.1 billion.

 

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Editor : M. Shamsur Rahman

Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

Editor : M. Shamsur Rahman
Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

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