Alphabet’s revenues undershot estimates in the fourth quarter as the search giant’s cloud business grew slower than expected, while it continued to accelerate its spending on data centres in response to demand from artificial intelligence.
Revenue rose 12 per cent to $96.5bn in the three months through December compared with the same period the previous year. Excluding traffic acquisition costs, that figure was $81.6bn, missing Wall Street estimates in a Bloomberg poll of $82.8bn. Net income rose 28 per cent to $26.5bn.
Alphabet shares dropped more than 6 per cent in after-hours trading. The stock had previously risen 45 per cent in the past 12 months, giving it a market capitalisation of $2.5tn and making it the fifth most-valuable listed company in the world behind Apple, Microsoft, Nvidia and Amazon.