Not advertising, Google is relying on the cloud

One segment witnessed growth of Google ‘s most great is not related to advertising. That is thanks to cloud computing. Google ’s parent company is Alphabet announced the second quarterly financial report in 2016. It is far beyond Wall Street‘s expectation. That makes its shares rose 5% after a few hours.

Specifically, revenue from money machine of Google advertising growth array at 19.5% over the previous year. While other markings such as Nest and Verily continue to cause losses to the company. The subject loss is 859 million USD.

Google is relying on the cloud

However, one segment witnessed immense growth of the company unrelated to advertising. It is thanks to cloud computing, revenue from app store Play, and hardware.

Accordingly, in this quarter, Alphabet has grossed 2.17 billion USD from three business segments listed above. The growth by 33% compared to the similar figure of 24% on the previous year.

In total over the same period, Alphabet’s revenue rose 21% to 21.5 billion USD. Excluding the expenses paid to advertising partners, net revenue reached $17.5 billion. That is higher than the 16.86 billion USD by forecast of analysts.

Alphabet’s net profit reached $4.88 billion USD in second quarter. It is much higher than 3.93 billion USD in the same period and the expectation of investors.

Google is relying on the cloud 1

In the published report business results, CEO Sundar Pichai said machine promoting growth mainly comes from businesses, Alphabet cloud computing and applications, after that it is hardware devices. CEO Pichai also revealed that Google has sold 30 million units since its launch Chromecast.

This growth rate develops nearly one year, Diane Greene is the one who leads the cloud computing segment for the company. And it looks like Greene is proving her decision about the right hire.

Represent of Alphabet communicates that they finally saw business towards corporate customers are becoming more important than advertising business.

The company predicted revenue from the cloud computing business will exceed revenue of advertising in 2020.

advertising Alphabet CEO Sundar Pichai Chromecast cloud computing Google Nest second quarterly financial report shares Verily Wall Street

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