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    GOOGL   US02079K3059

ALPHABET INC.

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Alphabet : Q2 Press release

07/27/2021 | 04:20pm EDT

Alphabet Announces Second Quarter 2021 Results

MOUNTAIN VIEW, Calif. - July 27, 2021 - Alphabet Inc. (NASDAQ: GOOG, GOOGL) today announced financial results for the quarter ended June 30, 2021.

Sundar Pichai, CEO of Google and Alphabet, said: "In Q2, there was a rising tide of online activity in many parts of the world, and we're proud that our services helped so many consumers and businesses. Our long-term investments in AI and Google Cloud are helping us drive significant improvements in everyone's digital experience."

"Our strong second quarter revenues of $61.9 billion reflect elevated consumer online activity and broad-based strength in advertiser spend. Again, we benefited from excellent execution across the board by our teams," said Ruth Porat, CFO of Google and Alphabet.

Q2 2021 financial highlights

The following table summarizes our consolidated financial results for the quarters ended June 30, 2020 and 2021 (in millions, except for per share information and percentages; unaudited).

Quarter Ended June 30,

2020

2021

Revenues

$

38,297

$

61,880

Change in revenues year over year

(2)%

62 %

Change in constant currency revenues year over year(1)

0 %

57 %

Operating income

$

6,383

$

19,361

Operating margin

17 %

31 %

Other income (expense), net

$

1,894

$

2,624

Net income

$

6,959

$

18,525

Diluted EPS

$

10.13

$

27.26

  1. Non-GAAPmeasure. See the table captioned "Reconciliation from GAAP revenues to non-GAAP constant currency revenues" for more details.

Q2 2021 supplemental information (in millions, except for number of employees; unaudited)

Revenues, Traffic Acquisition Costs (TAC) and number of employees

Quarter Ended June 30,

2020

2021

Google Search & other

$

21,319

$

35,845

YouTube ads

3,812

7,002

Google Network

4,736

7,597

Google advertising

29,867

50,444

Google other

5,124

6,623

Google Services total

34,991

57,067

Google Cloud

3,007

4,628

Other Bets

148

192

Hedging gains (losses)

151

(7)

Total revenues

$

38,297

$

61,880

Total TAC

$

6,694

$

10,929

Number of employees

127,498

144,056

Segment Operating Results

Quarter Ended June 30,

2020

2021

Operating income (loss):

Google Services

$

9,539

$

22,343

Google Cloud

(1,426)

(591)

Other Bets

(1,116)

(1,398)

Corporate costs, unallocated

(614)

(993)

Total income from operations

$

6,383

$

19,361

Change in the useful lives of our server and network equipment (unaudited)

In January 2021, we completed an assessment of the useful lives of our servers and network equipment and adjusted the estimated useful life of our servers from three years to four years and the estimated useful life of certain network equipment from three years to five years. This change in accounting estimate was effective beginning in fiscal year 2021 and the effect was a reduction in depreciation expense of $721 million and $1.6 billion and an increase in net income of $561 million and $1.2 billion, or $0.84 and $1.81 per basic and $0.83 and $1.78 per diluted share, for the three and six months ended June 30, 2021, respectively.

Stock Repurchase

As we previously announced in April 2021, the Alphabet board authorized the company to repurchase up to an additional $50 billion of its Class C capital stock under our stock repurchase program. On July 22, 2021, the board approved an amendment to the stock repurchase program permitting us to repurchase both Class A and Class C shares, in a manner deemed in the best interest of the company and its stockholders, taking into account the economic cost and prevailing market conditions, including the relative trading prices and volumes of the Class A and Class C shares.

2

Webcast and conference call information

A live audio webcast of our second quarter 2021 earnings release call will be available on YouTube at https:// youtu.be/4ku-6h3vuNw. The call begins today at 1:30 PM (PT) / 4:30 PM (ET). This press release, including the reconciliations of certain non-GAAP measures to their nearest comparable GAAP measures, is also available at http://abc.xyz/investor.

We also provide announcements regarding our financial performance, including SEC filings, investor events, press and earnings releases, and blogs, on our investor relations website (http://abc.xyz/investor).

We also share Google news and product updates on Google's Keyword blog at https://www.blog.google/, which may be of interest or material to our investors.

Forward-looking statements

This press release may contain forward-looking statements that involve risks and uncertainties. Actual results may differ materially from the results predicted, and reported results should not be considered as an indication of future performance. The potential risks and uncertainties that could cause actual results to differ from the results predicted include, among others, those risks and uncertainties included under the captions "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the year ended December 31, 2020, and our most recent Quarterly Report on Form 10-Q for the quarter ended March 31, 2021, which are on file with the SEC and are available on our investor relations website at http://abc.xyz/ investor and on the SEC website at www.sec.gov. Additional information will also be set forth in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2021. All information provided in this release and in the attachments is as of July 27, 2021. Undue reliance should not be placed on the forward-looking statements in this press release, which are based on information available to us on the date hereof. We undertake no duty to update this information unless required by law.

About non-GAAP financial measures

To supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, we use the following non-GAAP financial measures: free cash flow; constant currency revenues; and percentage change in constant currency revenues. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

We use these non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. We believe that these non-GAAP financial measures provide meaningful supplemental information regarding our performance and liquidity by excluding certain items that may not be indicative of our recurring core business operating results, such as our revenues excluding the effect of foreign exchange rate movements and hedging activities. We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, and analyzing future periods. These non-GAAP financial measures also facilitate management's internal comparisons to our historical performance and liquidity as well as comparisons to our competitors' operating results. We believe these non-GAAP financial measures are useful to investors both because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making and (2) they are used by our institutional investors and the analyst community to help them analyze the health of our business.

There are a number of limitations related to the use of non-GAAP financial measures. We compensate for these limitations by providing specific information regarding the GAAP amounts excluded from these non-GAAP financial measures and evaluating these non-GAAP financial measures together with their relevant financial measures in accordance with GAAP.

For more information on these non-GAAP financial measures, please see the tables captioned "Reconciliation from net cash provided by operating activities to free cash flow" and "Reconciliation from GAAP revenues to non-GAAP constant currency revenues" included at the end of this release.

Contact

Investor relations

Media

investor-relations@abc.xyz press@abc.xyz

3

Alphabet Inc.

CONSOLIDATED BALANCE SHEETS

(In millions, except share amounts which are reflected in thousands and par value per share amounts)

As of

As of

December 31,

June 30,

2020

2021

(unaudited)

Assets

Current assets:

Cash and cash equivalents

$

26,465

$

23,630

Marketable securities

110,229

112,233

Total cash, cash equivalents, and marketable securities

136,694

135,863

Accounts receivable, net

30,930

31,967

Income taxes receivable, net

454

884

Inventory

728

907

Other current assets

5,490

6,076

Total current assets

174,296

175,697

Non-marketable investments

20,703

25,532

Deferred income taxes

1,084

1,153

Property and equipment, net

84,749

91,697

Operating lease assets

12,211

12,978

Intangible assets, net

1,445

1,626

Goodwill

21,175

22,406

Other non-current assets

3,953

4,298

Total assets

$

319,616

$

335,387

Liabilities and Stockholders' Equity

Current liabilities:

Accounts payable

$

5,589

$

4,708

Accrued compensation and benefits

11,086

10,088

Accrued expenses and other current liabilities

28,631

28,981

Accrued revenue share

7,500

7,438

Deferred revenue

2,543

2,715

Income taxes payable, net

1,485

1,811

Total current liabilities

56,834

55,741

Long-term debt

13,932

14,328

Deferred revenue, non-current

481

510

Income taxes payable, non-current

8,849

8,651

Deferred income taxes

3,561

4,703

Operating lease liabilities

11,146

11,619

Other long-term liabilities

2,269

2,270

Total liabilities

97,072

97,822

Contingencies

Stockholders' equity:

Convertible preferred stock, $0.001 par value per share, 100,000 shares authorized; no

0

0

shares issued and outstanding

Class A and Class B common stock, and Class C capital stock and additional paid-in

capital, $0.001 par value per share: 15,000,000 shares authorized (Class A 9,000,000,

Class B 3,000,000, Class C 3,000,000); 675,222 (Class A 300,730, Class B 45,843,

Class C 328,649) and 667,637 (Class A 301,040, Class B 45,546, Class C 321,051)

58,510

60,436

shares issued and outstanding

Accumulated other comprehensive income (loss)

633

190

Retained earnings

163,401

176,939

Total stockholders' equity

222,544

237,565

Total liabilities and stockholders' equity

$

319,616

$

335,387

4

Alphabet Inc.

CONSOLIDATED STATEMENTS OF INCOME

(In millions, except share amounts which are reflected in thousands and per share amounts)

Quarter Ended June 30,

Year To Date June 30,

2020

2021

2020

2021

(unaudited)

(unaudited)

Revenues

$

38,297

$

61,880

$

79,456

$

117,194

Costs and expenses:

Cost of revenues

18,553

26,227

37,535

50,330

Research and development

6,875

7,675

13,695

15,160

Sales and marketing

3,901

5,276

8,401

9,792

General and administrative

2,585

3,341

5,465

6,114

Total costs and expenses

31,914

42,519

65,096

81,396

Income from operations

6,383

19,361

14,360

35,798

Other income (expense), net

1,894

2,624

1,674

7,470

Income before income taxes

8,277

21,985

16,034

43,268

Provision for income taxes

1,318

3,460

2,239

6,813

Net income

$

6,959

$

18,525

$

13,795

$

36,455

Basic earnings per share of Class A and B common

$

10.21

$

27.69

$

20.16

$

54.32

stock and Class C capital stock

Diluted earnings per share of Class A and B common

$

10.13

$

27.26

$

20.00

$

53.54

stock and Class C capital stock

Number of shares used in basic earnings per share

681,768

668,958

684,117

671,089

calculation

Number of shares used in diluted earnings per share

687,024

679,612

689,646

680,842

calculation

5

Disclaimer

Alphabet Inc. published this content on 27 July 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 27 July 2021 20:19:04 UTC.


© Publicnow 2021
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Net income 2021 68 645 M - -
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Nbr of Employees 144 056
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Number of Analysts 45
Last Close Price 2 816,00 $
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Managers and Directors
Sundar Pichai Chief Executive Officer & Director
Ruth M. Porat Chief Financial Officer & Senior Vice President
John LeRoy Hennessy Chairman
Louis John Doerr Independent Director
Ann Mather Independent Director
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