01—Abstract
Summary
Summary of the 10-Q filed July 24, 2024. Cited figures are marked; the original filing is the authoritative source.
Alphabet Inc. reported strong financial results for the second quarter of 2024, with total revenues reaching $84.7 billiona, a 14% increase year-over-year.
This growth was primarily driven by a 12% increase in Google Services revenues, totaling $73.9 billionb, and a substantial 29% surge in Google Cloud revenues, amounting to $10.3 billion. The company also saw significant improvements in profitability, with operating income rising 26% to $27.4 billion and net income increasing by 29% to $23.6 billion. Key drivers for the robust performance include continued strength in Google Search & advertising, alongside growing contributions from Google subscriptions, platforms, and devices.
Google Cloud's accelerated growth highlights its increasing importance as a revenue contributor. The company demonstrated strong cash flow generation, with operating cash flow at $26.6 billionc for the quarter, and continued its commitment to returning capital to shareholders through significant share repurchases totaling $15.6 billion and initiated its first quarterly dividend. Investment in technical infrastructure, particularly for AI, remains a priority, as reflected in a 25% increase in capital expenditures year-over-year to $25.2 billion for the first six months of the year.
02—Key points
Key Highlights
- Total revenues increased 14% year-over-year to $84.7 billion.
- Google Services revenue grew 12% to $73.9 billion, driven by advertising and subscriptions.
- Google Cloud revenue surged 29% to $10.3 billion, indicating strong enterprise adoption.
- Operating income rose 26% to $27.4 billion, with operating margin improving to 32%.
- Net income increased 29% to $23.6 billion, resulting in diluted EPS of $1.89.
- The company initiated its first quarterly cash dividend of $0.20 per share.
- Share repurchases totaled $15.6 billion for the quarter, with $74.9 billion remaining under authorized programs.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q2 FY2024, Alphabet Inc. kept $0.28.
- Revenue$84.74B100.0%
- Cost of revenue−$35.51B41.9%
- Gross profit$49.23B58.1%
- Operating costs−$21.81B25.7%
- Operating income$27.43B32.4%
- Interest, other & tax−$3.81B4.5%
- Net income$23.62B27.9%
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2024filed July 24, 2024Financial Statements
Q2 FY2024 against Q2 FY2023
| Line item | Q2 FY2024Q2 FY2023 | Change |
|---|---|---|
| Revenue | $84.74B$74.60B | +13.6% |
| Cost of Revenue | $35.51B$31.92B | +11.3% |
| Gross Profit | $49.23B$42.69B | +15.3% |
| R&D Expenses | $11.86B$10.59B | +12.0% |
| Operating Expenses | $57.32B$52.77B | +8.6% |
| Operating Income | $27.43B$21.84B | +25.6% |
| Net Income | $23.62B$18.37B | +28.6% |
| EPS (Basic) | $1.91$1.45 | +31.7% |
| EPS (Diluted) | $1.89$1.44 | +31.3% |
| Shares Outstanding (Basic) | 12.34B12.67B | −2.6% |
| Shares Outstanding (Diluted) | 12.49B12.76B | −2.1% |
05—Questions
Frequently Asked Questions
What is Alphabet's revenue growth performance for Q2 2024?
Alphabet reported a 14% year-over-year increase in total revenues for the second quarter of 2024, reaching $84.7 billion. This growth was primarily fueled by Google Services, which increased by 12% to $73.9 billion, and a strong 29% surge in Google Cloud revenues to $10.3 billion.
How did Alphabet's profitability fare in Q2 2024?
Profitability showed significant improvement. Operating income increased by 26% to $27.4 billion, and the operating margin expanded to 32%. Net income grew by 29% to $23.6 billion, leading to diluted earnings per share (EPS) of $1.89.
What is Alphabet's stance on capital returns to shareholders?
Alphabet demonstrated a commitment to returning capital to shareholders. The company repurchased $15.6 billion of Class A and Class C shares during the quarter and announced its first quarterly cash dividend of $0.20 per share, reflecting a strategic shift in capital allocation.
How is Alphabet investing in future growth, particularly in AI?
The company continued to make substantial investments in its technical infrastructure, with capital expenditures for the first six months of 2024 totaling $25.2 billion, a 25% increase year-over-year. These investments are particularly focused on supporting the growth of its business and long-term initiatives, especially in AI products and services.
06—Continue