Alphabet Plans 50 Billion Buyback

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Alphabet Plans 50 Billion Buyback

Alphabet sets profit record, plans $50 billion buyback

Alphabet has reported a record profit along with a share buyback worth $50 billion. It simultaneously warned that advertisement sales may drop as the COVID-19 restrictions are getting removed gradually and people are back to work in physical offices. Online consumer activities were high during the pandemic period and the company surpassed the sales record.

The ad sales of Google gained by 32 percent and cloud sales increased by 45.7 percent lately. The Alphabet shares value was up by 4.3 percent.

However, the results reveal outstanding gains of important Alphabet products including YouTube and Google Search may reduce compared to the pandemic years when people were forced to remain at home due to lockdowns. People were left with no choice but to communicate and shop online.

The high-earning region for the company is the United States and about a significant adult population is now fully vaccinated against the virus. In-person activities like dining have resumed and airports have now been turned out to be the busiest days of the year.

Alphabet CEO stated forecasting the extent of consumer behavior is now too early as it is yet to know how advertising spending will turn up.

Alphabet was incorporated in 2015 and it is the first time since then that the operating margins have been up by about 30 percent. The slowest sales were recorded in 2020 compared to the past 11 years, but with record profit and cash.

Google is the global market leader in the ad business and the Google Cloud is far behind the same of Microsoft and Amazon.

Many investors and analysts are now concerned about the long-term prospects of Google amid the changing laws in Europe and the US related to privacy, trust and AI factors. Moreover, Google has been accused of anticompetitive behavior in the hardware and video streaming segments.

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