Google earnings hit by European fine
FBN’s Kristina Partsinevelos on the European Union’s record fine against Google over antitrust violations.
Google parent Alphabet Inc. reported a 9.3% drop in second-quarter earnings, which included a $5 billion charge to cover a fine by European regulators.
Earlier this month, the European Union hit Google with a record antitrust fine accusing it of abusing the dominance of the Android mobile operating system, which is used by more than 80% of the world's smartphones. Google said it is appealing the charges.
Excluding the impact of the fine, the company reported per-share earnings of $11.75, above the comparable year-ago figure of $8.90 and beating the analyst estimate of $9.66, according to analysts polled by FactSet.
Shares of Google rose 5.9% to $1,282 in after-hours trading.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| GOOGL | ALPHABET INC. | 164.76 | -2.87 | -1.71% |
As Google faces more pressure from regulators seeking to rein in the power of the internet giant, investors are worried that new laws and restrictions will impede its growth. In addition to the fine related to Android, European regulators this year began enforcing a sweeping new privacy regulation forcing Google and other internet companies to get consent from web users to collect their data and target ads to them.
Despite the privacy law, marketers continued to buy up ads from Google. The online ad leader said revenue, excluding traffic costs paid to partners, jumped 25% to $26.24 billion.