Alphabet earnings report sends shares soaring

By Barry Eitel

PUERTO VALLERTA – Google’s parent company posted second quarter and earnings Thursday, enthralling investors with a 21 percent increase in revenue compared to the same quarter last year.

Alphabet, which was formed as Google's umbrella company in October, brought in $21.5 billion in revenue for the quarter ending June 30, compared to $17.7 billion for the same period of 2015. The company revealed that it made nearly $5 billion in profit for the quarter.

Interestingly, Alphabet announced that its Other Bets sector, comprising innovate projects such as self-driving automobiles, pulled in $184 million in revenue for the quarter, almost 2.5 times the amount the sector earned a year ago. Other Bets, whose other projects include the Web-connected Nest thermostat and Fiber high-speed Internet, reported total losses of $859 million -- meaning these products have a long way to go until profitability.

"Our terrific second quarter results, with 21 percent revenue growth year on year, and 25 percent on a constant currency basis reflect the successful investments we've made over many years in rapidly expanding areas such as mobile and video," Ruth Porat, Alphabet's chief financial officer, said in a statement. "We continue to invest responsibly in support of our many compelling opportunities."

Shares of Alphabet neared an all-time high during trading Thursday at $765.84 amid rumors of the bountiful earnings report.

After the report was released following the close of markets, the stock jumped more than 5 percent to $808.50, higher than shares of Alphabet, or Google before it, have ever traded since the company went public in 2004.

With a market value of $521 billion, Alphabet is closing in on Apple to become the most valuable company in the world. The iPhone maker has a market capitalization of $609 billion as of Thursday.