The world's number one advertising turnover increased by 17% to $ 36.34 billion, coming under Wall Street expectations of $ 37.3 billion. It rose 19% excluding the exchange impact, compared with + 22% in the previous quarter. Thus, growth was below 20% for the first time since the third quarter of 2014.
Their advertising revenues, they increased 15.3% to 30.72 billion dollars. They also slowed down, recording the smallest increase since 2015. They increased 19.9% in the last three months of 2018.
Not only was the activity not as dynamic as expected, but the explanations given by the group's chief financial officer, Ruth Porat, were not clear enough. She questioned the currency effects, an unfavorable basis for comparison and changes in advertising revenue in 2018.
"The group did not give more clarity about the nature of the changes, whether the impact will be linear on a quarterly basis or whether there will be other changes," Morgan Stanley laments, as do many of his confreres. . He therefore calls for more transparency, which he believes will continue to be a key element of long-term evaluation.
Some investors are worried about the fact that this slowdown may be the result of increased competition in online advertising. If Google has long crushed this market, it should now face competition from Facebook, but also from Amazon, which would be the number three in the United States, according to studies of the company eMarketer.
First quarter results exceeded expectations. The well-known Internet company reported a net profit of $ 6.66 billion, or $ 9.50 per share, compared to net income of $ 9.4 billion, or $ 13.33 per share, a year earlier. because of the tax reform.
Accounts for this year, however, include the Brussels fine of $ 1.7 billion. Fixed exceptional items, earnings per share were $ 11.90, exceeding the IBES consensus of $ 10.61.
Its operating margin, which is highly monitored, fell 3 points, excluding the impact of the fine, 22%. Google is regularly criticized by analysts for being too expensive. The title was sanctioned for this reason when the results of the fourth quarter were published.
Operating expenses increased 20% this quarter, excluding fines, $ 12 billion and investments of $ 4.6 billion.
Google has predicted a sharp slowdown in total investment growth in 2019 but has confirmed that it will invest $ 13 billion in data centers and offices in the United States this year.
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