The company’s dominant search business has weathered the economic downturn.
Despite the economic slump, Alphabet Inc.’s dominating search business outperformed analysts’ expectations in the first quarter, and its cloud segment made a profit for the first time.
The cloud division made a profit of $191 million.
Search advertising is more resilient during economic downturns than social media marketing.
According to Evelyn Mitchell, Senior Analyst at Insider Intelligence, “search results will serve as an early indicator of Google’s ability to maintain its dominance in the area that generates the majority of its revenue.”
As advertisers reduce their spending, Alphabet’s management is pushing for cost-cutting measures to preserve the business’ profit margins.
In contrast to Wall Street’s projection of $1.09 per share, Alphabet’s earnings came in at $15 billion, or $1.17 per share. This year, the company’s stock has increased by 17.7%.