Shares of Alphabet, the holding company for Google, skyrocketed after Monday’s closing bell as an earnings release showed a big jump in revenue and slight growth in profit to end 2015.
Alphabet reported $21.3 billion in revenue in the three months ended Dec. 31, up 18 percent from $18.1 billion in the same period a year earlier. Profit reached $4.9 billion, up 5 percent from $4.7 billion the year before.
Increased usage of YouTube, of machine-purchased ads and of Google on mobile devices helped drive the strong results, Alphabet Chief Financial Officer Ruth Porat said in a statement. Alphabet shares spiked more than 8 percent at one point after hours, bringing the company closer to overtaking Apple Inc. as the world’s most valuable company. Shares closed regular trading at $752, up about 1.2 percent, or $9.
Monday’s results were the first time the company reported financial results under its new name.
Google announced in August that it was forming a parent company called Alphabet in a move to streamline its corporate structure, which had grown unwieldy and included disparate interests in Internet search, drones, investments, health care, wearables, online shopping, self-driving cars and more.
Under Alphabet, the company aims to better organize those businesses by operating as a collection of separate entities.
The largest is Google, which contains core businesses including search, ads, maps, YouTube and Android. It’s managed separately from investment arms Google Ventures and Google Capital and other projects such as Fiber, Nest, X, Calico and Verily (formerly life sciences).
For its earnings reports, that means Alphabet now reports its results in two categories: Google and “Other Bets.”
Analysts knew those other bets were costing Google money, but they were excited to get their first look at just how much. Other Bets recorded an operating loss of $3.6 billion in 2015, almost double that of 2014. The division generated just $448 million in revenue last year, compared with $74.5 billion at ad-driven Google. Still, Other Bets’ fourth-quarter revenue more than doubled the second quarter’s.
Alphabet added more than 8,200 employees in 2015, bringing its workforce to 61,814 at year’s end.
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