Alphabet Inc. (GOOGL) 10-Q Quarterly Report October 2019

MOUNTAIN VIEW, Calif. – October 28, 2019 – Alphabet Inc. (NASDAQ: GOOG, GOOGL) today announced financial results for the quarter ended September 30, 2019.

“I am extremely pleased with the progress we made across the board in the third quarter, from our recent advancements in search and quantum computing to our strong revenue growth driven by mobile search, YouTube and Cloud,” said Sundar Pichai, Chief Executive Officer of Google. “We’re focused on providing the most helpful services to our users and partners, and we see many opportunities ahead.”

“Our businesses delivered another quarter of strong performance, with revenues of $40.5 billion, up 20% versus the third quarter of 2018 and up 22% on a constant currency basis,” said Ruth Porat, Chief Financial Officer of Alphabet and Google. “We continue to invest thoughtfully in talent and infrastructure to support our growth, particularly in newer areas like Cloud and machine learning.”

Q3 2019 financial highlights

The following table summarizes our consolidated financial results for the quarters ended September 30, 2018 and 2019 (in millions, except for per share information, percentages, and number of employees; unaudited):



	Three Months Ended September 30, 2018			Three Months Ended September 30, 2019
Revenues		$33,740			$40,499
Increase in revenues year over year	21		%	20		%
Increase in constant currency revenues year over year	22		%	22		%

Operating income⁽¹⁾		$8,625			$9,177
Operating margin⁽¹⁾	26		%	23		%

Other income (expense), net⁽¹⁾		$1,458			($549	)

Net income		$9,192			$7,068
Diluted EPS		$13.06			$10.12
Diluted shares (in thousands)	703,859			698,199

Effective tax rate	9		%	18		%
Number of employees	94,372			114,096


⁽¹⁾	Q3 2018 results have been recast to reflect the reclassification of performance fees from general and administrative expenses to other income (expense), net (OI&E) to conform to the current period presentation.

Q3 2019 supplemental information (in millions, except for percentages; unaudited)

Segment revenues and operating results



	Three Months Ended September 30, 2018			Three Months Ended September 30, 2019
Google properties revenues		$24,054			$28,647
Google Network Members' properties revenues	4,900			5,269
Google advertising revenues	28,954			33,916
Google other revenues	4,640			6,428
Google segment revenues		$33,594			$40,344
Other Bets revenues		$146			$155

Google operating income		$9,490			$10,865
Other Bets operating loss		($727	)		($941	)

The following information was filed by Alphabet Inc. (GOOGL) on Monday, October 28, 2019 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Alphabet Inc.'s 10-Q Quarterly Report:

Revenue - Product Highlight
Our advertising revenue growth, as well as the change in paid clicks and cost-per-click on Google properties and the change in impressions and cost-per-impression on Google Network Members' properties and the correlation between these items, have been affected and may continue to be affected by various factors, including: advertiser competition for keywords; changes in advertising quality, formats or delivery; changes in device mix; changes in foreign currency exchange rates; fees advertisers are willing to pay based on how they manage their advertising costs; general economic conditions; growth rates of revenues within Google properties; 34 seasonality; and traffic growth in emerging markets compared to more mature markets and across various advertising verticals and channels.

Revenue - Product Highlight
Cash Used in Investing Activities Cash provided by or used in investing activities primarily consists of purchases of property and equipment, which primarily includes our investments in land and buildings for offices and data centers, as well as, servers to provide capacity for the growth of our businesses; purchases, maturities, and sales of marketable and non-marketable securities; and payments for acquisitions.
Financial - Debt Highlight
Cash Used in Financing Activities Cash provided by or used in financing activities consists primarily of net proceeds or payments related to stock-based award activities, repurchases of capital stock, net proceeds or payments from issuance or repayments of debt, and proceeds from sale of interest in consolidated entities.
Financial - Expense Highlight
In addition, there was an increase in compensation expenses (including SBC) and facilities-related costs of $477 million, largely resulting from a 19% increase in headcount.
Financial - Expense Highlight
The increase was primarily due to an increase in compensation expenses (including SBC) and facilities-related costs of $1,017 million, largely resulting from a 21% increase in headcount.
Financial - Expense
The increase was primarily due...Read more
Financial - Expense
The increase was primarily due...Read more
Financial - Expense
The increase was primarily due...Read more
Financial - Expense
The cost of revenues related...Read more
Revenue - Product
Our Other Bets revenue increased...Read more
Financial - Income
Other income (expense), net, was...Read more
Legal - Other
The increase was primarily due...Read more
Other - Other
The number of paid clicks...Read more
Revenue - Geography
Our future effective tax rate...Read more
Revenue - Product
The growth was primarily driven...Read more
Financial - Expense
In addition, there was an...Read more
Financial - Expense
In addition, there was an...Read more
Financial - Debt
Cash equivalents and marketable securities...Read more
Revenue - Product
The following table presents our...Read more
Financial - Expense
In addition, uses of cash...Read more
Financial - Expense
R&D expenses increased $1,322 million...Read more
Financial - Expense
40 R&D expenses increased $3,411...Read more
Financial - Expense
General and administrative expenses increased...Read more
Financial - Expense
41 General and administrative expenses...Read more
Revenue - Geography
37 The following table presents...Read more
Revenue - Product
Our advertising revenue growth rate...Read more
Financial - Expense
The following table presents our...Read more
Revenue - Product
The Google properties TAC rate...Read more
Revenue - Product
33 The following table presents...Read more
Revenue - Product
Our Google properties revenues increased...Read more
Revenue - Product
Our Google Network Members' properties...Read more
Revenue - Product
Our Google other revenues increased...Read more
Revenue - Product
Net cash used in financing...Read more
Revenue - Product
Our revenues from APAC for...Read more
Revenue - Product
38 Our revenues from Other...Read more
Revenue - Product
Our revenues from Other Americas...Read more
Other - Other
As of September 30, 2019,...Read more
M & A - Other
We believe that our sources...Read more
Other - Other
We also experienced growth in...Read more
Financial - Expense
The cost-per-impression was relatively unchanged...Read more
Revenue - Product
Google segment revenues of $40.3...Read more
Revenue - Geography
The growth was partially offset...Read more
Revenue - Product
Our international revenues are favorably...Read more
Other - Other
Effective tax rate was 18%....Read more
Revenue - Geography
The growth was primarily driven...Read more
Revenue - Product
Our international revenues are also...Read more

Financial Statements, Disclosures and Schedules

Inside this 10-Q Quarterly Report

Material Contracts, Statements, Certifications & more

Alphabet Inc. provided additional information to their SEC Filing as exhibits

Exhibit 31.01: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 31.02: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 32.01: Section 1350 Certification

Ticker: GOOGL
CIK: 1652044
Form Type: 10-Q Quarterly Report
Accession Number: 0001652044-19-000032
Submitted to the SEC: Mon Oct 28 2019 3:02:44 PM EST
Accepted by the SEC: Tue Oct 29 2019
Period: Monday, September 30, 2019
Industry: Computer Programming Data Processing