4th Quarterly Miss in Q4
Shares in Google parent company Alphabet are down around 5% ahead of the open today as traders digest the company’s Q4 earnings reported late yesterday. The company undershot both EPS and revenues forecasts with EPS of -$1.05 vs $1.17 forecast and revenues of $76.04 billion vs $76.17 forecast. Underwhelming Q4 results marked the fourth straight quarter of earnings misses.
Alphabet shares fell around 45% at their lowest from the highs in 2021 though have recovered so far this year amidst the broad pickup in stocks. The Fed pivot is helping underpin stocks across the board for now. However, Alphabet’s weak earnings mean the stock might not enjoy the same gains seen elsewhere.
The company attribute the poor performance to weaker advertising spending. The DOJ has recently called for its ad business to be broken up, accusing Alphabet of operating an illegal monopoly in the sector. Looking ahead, the company said that it will focus more time and investment on AI research and development, looking to incorporate AI into its core businesses. With competitors seen beefing up their spending on AI it is clear that this will be one of the key battlegrounds for tech in coming years.
Technical Views
Alphabet
The rally in Alphabet shares has seen price breaking out above the bearish trend line from 2021 highs and above the 104.09 level. With momentum studies bullish, the focus remains on a further push higher while price sits above this area. 120.10 is the next upside level to note.
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