Alphabet Inc said on Tuesday it would buy back US$70 billion in stock and posted first-quarter revenue above estimates as demand rose for cloud services and ad sales held up better than expected.
Investors cheered the buyback plan, sending shares of the Google parent about four per cent higher in extended trading.
Advertisers, who contribute the bulk of Alphabet’s sales, have been shifting budgets to proven platforms such as Google’s products and its YouTube unit from untested advertising models.
Alphabet reported a slight dip in ad sales to US$54.55 billion from US$54.66 billion a year earlier. The decline is just the third in the company’s history since it became public in 2004 but follows a fourth quarter drop of 3.6 per cent.
The company, meanwhile, has been looking to keep a tight control on costs amid recession fears and had in January decided to cut about 12,000 jobs.
It has also been sharpening focus on artificial intelligence in its race to gain lost ground from Microsoft Corp’s Bing and the Windows-maker backed ChatGPT maker, OpenAI.
Revenue for the quarter ended March 31 stood at $69.79 billion compared with estimates of $68.95 billion, according to Refinitiv data.
It reported net profit of $15.05 billion for the first three months of the year compared with $16.44 billion a year earlier.
(Reporting by Akash Sriram in Bengaluru and Greg Bensinger in San Francisco; Editing by Arun Koyyur, Sayantani Ghosh and Matthew Lewis)