Alphabet, Google's parent company, reported fourth quarter earnings on Monday. (AP Photo/Jeff Chiu)
Google seems unstoppable.
Alphabet destroyed Wall Street expectations when it released fourth quarter earnings on Monday and for the first time it separated results from the core, massively profitable Google search and advertising business from its "other bets" that include everything from Next, Google Fiber, Google Capital, Google Ventures, and many more money-losing operations.
The company posted overall revenue of $21.33 billion (up 18% year over year) and earnings per share of $8.67. That beat the street's estimates of $20.8 billion in revenue and earnings per share of $8.10. In after hours trading, Alphabet shares jumped more than 8%. The after hours stock rise pushed Alphabet's market capitalization above $550 billion, passing Apple as the world's most valuable company.
For the year, Alphabet's "other bets" lost $3.57 billion on just $448 million in revenue, even more than the $1.94 billion lost in 2014 on revenue of $327 million. But those losses were dwarfed by Google's core, which reported operating income of more than $23 billion.
Reporting separate results sheds some light on how much Alphabet is spending per year on its longshot projects, for which RBC Capital Markets analyst Mark Mahaney had wide estimates for operating losses anywhere from $3 billion to $6 billion in 2015. It also reveals just how profitable Google's core is, an attractive proposition for Wall Street.
"Our very strong revenue growth in Q4 reflects the vibrancy of our business, driven by mobile search as well as YouTube and programmatic advertising, all areas in which we've been investing for many years. We're excited about the opportunities we have across Google and Other Bets to use technology to improve the lives of billions of people," Ruth Porat, CFO of Alphabet, said in a statement.
