For Alphabet, a Record Fine is Both a Footnote and a Warning
Posted in: Miscellaneous at 25/07/2017 20:40
Not many companies can turn a $2.7 billion fine into a financial footnote.
But that is what Google’s parent company, Alphabet, did with its quarterly earnings. The results, announced on Monday, were a microcosm of the opportunities and the risks in front of the company. On one hand, it was hitting on all cylinders with its core search engine. Its various internet services were as essential as ever with the shift to smartphones. And its YouTube video platform was shaking off a short-lived boycott by big brands.
But while its business hums along, Alphabet faces a challenge that has little to do with its day-to-day performance.
A month after the European Commission handed down a record $2.7 billion penalty against Google for what it said was “illegal conduct” in unfairly promoting its own shopping services over competitors, Democrats in the United States are calling for more antitrust oversight of big companies. Senator Cory Booker, Democrat of New Jersey, told the technology site Recode that antitrust regulators should examine Google.
The Google Machine Barrels Along Despite Record EU Fine
Last month the European Union clobbered Google with a record $2.7 billion fine over its shopping search results. It was a big fine by any measure, but based on its quarterly earnings report released today, Google absorbed the shock easily.
Yes, profits were down a bit from last quarter due mostly to the fine: $3.5 billion in its second quarter this year versus $4.9 in the same quarter last year. But that's still a healthy profit that beat analyst expectations. Without the fine, which its parent company Alphabet is appealing, the search giant would have made $6.3 billion.