After the closing bell on Tuesday, Google parent Alphabet (NASDAQ:GOOGL) released its fourth-quarter revenue, providing better-than-expected financial results.
In the regular session, before results came out, shares of Alphabet were up nearly 2% and, following its release, vaulted higher by another 8% in after-hours trading.
Revenue jumped 32% to $75.3 billion year-over-year, while net income came in 36% higher than the year-earlier period to $20.6 billion. Overall results for Alphabet closed 2021 off strong, with revenue up 41% and net income soaring 89% from 2020 levels.
Google's advertising business, including YouTube, accounted for 81% of Alphabet's revenues in both 2021 and 2020, while Google Cloud increased quarterly revenue by 45% to $5.5 billion.
Along with the earnings release, Alphabet also announced its Board of Directors' approval of a 20-for-1 split. The move, which requires approval from shareholders, is expected to make the stock available for mass investors, bringing Alphabet's price down to $150 per share from its current roughly $3,000.
Based on company predictions, investors could see the split come into effect from 1 July 2022.
"Our deep investment in AI technologies continues to drive extraordinary and helpful experiences for people and businesses across our most important products. Q4 saw ongoing strong growth in our advertising business, which helped millions of businesses thrive and find new customers, a quarterly sales record for our Pixel phones despite supply constraints, and our Cloud business continuing to grow strongly." - CEO Sundar Pichai of Google & Alphabet
In 2021, the company repurchased common stock worth $50 billion, with its cash hoard growing nearly $3 billion in 2021 to $139.6 billion.
Over the past year, shares of Alphabet have shot up nearly 60%. The stock has an overall Strong Buy consensus rating and an average price target of $3,441.47, implying an upside potential of 25% to current levels.
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