Google has been under the radar of European authorities and has recently faced a number of problems. Despite all the heat, the search engine giant still seems to be reporting good quarterly figures and impressive profits.
A record-high fine of $5 billion was recently imposed on Google for anti-competitive practices from EU authorities. The amount is higher than any antitrust fine ever placed on a tech company. But if we look at quarterly reports for Q2 2018 of Alphabet, Google’s parent company, all seems well.
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According to the financial statements, Alphabet recorded a total of $26.24 billion revenue (at $2.8 billion profit) after accounting for the $5 billion fine. Without the fine, the company would have made $32.6 billion (at $7.8 billion profit) – this is significantly higher than the analysts’ forecast of $32.19 billion.
At the end of the same quarter, the group’s earning per share (EPS) stood at $11.75 if we exclude the EU fine (profit per share would reduce to $4.54 per share if the fine is accounted for) – analyst estimates predicted it to be $9.66 per share.
Moreover, Alphabet’s stock rose by over 5 percent during after-hours trading. The conglomerate is now closing in towards the likes of Apple and Amazon in terms of size and value.
Highest Ever Antitrust Penalty
Google was fined by the EU authorities because it bundles its own apps, like Chrome and Search, with almost every Android smartphone sold, and this causes Google to maintain its dominance in the web browser and search engine market, authorities say.
This way, the search engine giant uses Android’s popularity to put competitors at a disadvantage, as users are likely to keep using default apps that come bundled with a new smartphone.
Read more on the EU fine here.
