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Alphabet (GOOGL) to Report Q3 Earnings: What's in the Cards?
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Alphabet (GOOGL - Free Report) is scheduled to report third-quarter 2022 results on Oct 25.
For the quarter under review, the Zacks Consensus Estimate for revenues is pegged at $58.35 billion, indicating an improvement of 8.8% from the year-ago reported number.
The consensus mark for earnings is pegged at $1.25, indicating a 10.7% fall from the previous year’s reported number. The estimated figure has been stable over the past 30 days.
GOOGL’s bottom line surpassed the Zacks Consensus Estimate in two of the trailing four quarters and missed the same twice, delivering an earnings surprise of 6.8%, on average.
Alphabet’s robust Search segment continues to be the key catalyst for its top-line growth. Its expanding ad services portfolio, a strong search engine and improving search results are likely to have benefited its third-quarter performance.
We believe that GOOGL’s continued efforts toward advancing its Search segment are expected to have driven traffic on its platform in the third quarter.
Technical advancements in Google Assistant and Google Maps are expected to have boosted momentum across search further. This is expected to have contributed well to the performance of Google Services in the quarter under review.
The growing momentum across its mobile search is anticipated to have been another positive.
Google’s growing investments in AI are likely to have continued benefiting its advertisement business and enhancing search results in the to-be-reported quarter.
Solid adoption of Alphabet’s innovative products like Search Ads and Google Lens might have aided growth in Search revenues. Further, growing momentum in the new feature called Multisearch, which helps people find what they need using words and images at the same time, remains a positive.
Strengthening momentum across YouTube Shorts is expected to have driven consistent growth in the subscriber base on YouTube in the third quarter.
Coming to cloud prospects, Alphabet has been significantly gaining momentum in the highly competitive cloud market for a while on the back of its expanding cloud service portfolio and an increasing number of data centers.
The impacts of GOOGL’s go-to-market strategy, and strengthening cloud infrastructure and ecosystem are expected to get reflected in its third-quarter revenues.
The solid adoption of the Google Cloud Platform and Google Workspace is likely to have contributed well to the performance of the Google Cloud segment in the to-be-reported quarter. Also, growing momentum in the data cloud market might have been a positive.
Android, Meet, Waymo and Cybersecurity Efforts to Consider
Google’s strength across Android, Meet and autonomous driving is anticipated to have aided its third-quarter performance.
The growing momentum across Android 12 is likely to have benefited Alphabet’s performance in the to-be-reported quarter.
Google’s growing efforts to advance its video conferencing software Google Meet with new user-friendly features are likely to have bolstered its user base in the quarter to be reported. Alphabet rolled out an account-switching feature on Google Meet for users with multiple accounts on their devices in the third quarter.
Alphabet also updated Meet with a default link-handling capability so that meeting links open in the new Google Meet app instead of Meet (Original).
The growing prospects around Alphabet’s self-driving unit Waymo are expected to have been other major tailwinds. The impacts of GOOGL’s efforts toward expanding its Early Rider program called Waymo One Trusted Tester across the United States are likely to get reflected in the upcoming results. In the third quarter, Waymo started testing its self-driving vehicles on the streets of Bellevue, WA.
The impacts of growing cybersecurity efforts are likely to get reflected in Alphabet’s third-quarter results. Google completed the acquisition of Mandiant in the third quarter.
Mandiant offers advanced capabilities and threat intelligence services that help organizations combat cyberattacks. This buyout is expected to have contributed well to GOOGL’s third-quarter performance.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for Alphabet this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Alphabet has an Earnings ESP of -2.07% and a Zacks Rank #3 at present.
Stocks to Consider
Here are some stocks worth considering, as our model shows that these have the right combination of elements to beat on earnings this season.
Cognizant is set to report third-quarter 2022 results on Nov 2. The Zacks Consensus Estimate for CTSH’s earnings is pegged at $1.17 per share, suggesting an increase of 10.4% from the prior-year quarter’s reported figure.
Benefitfocus has an Earnings ESP of +2.32% and a Zacks Rank of 3 at present.
Benefitfocus is scheduled to release third-quarter fiscal 2022 results on Nov 2. The Zacks Consensus Estimate for BNFT’s loss is pegged at 14 cents per share, which is narrower than the prior-year quarter’s reported loss of 19 cents per share.
CDW (CDW - Free Report) has an Earnings ESP of +0.31% and is Zacks #3 Ranked at present.
CDW is expected to release third-quarter 2022 results on Nov 2. The Zacks Consensus Estimate for CDW’s earnings is pegged at $2.52 per share, suggesting an increase of 18.3% from the year-ago quarter’s reported figure.
Image: Bigstock
Alphabet (GOOGL) to Report Q3 Earnings: What's in the Cards?
Alphabet (GOOGL - Free Report) is scheduled to report third-quarter 2022 results on Oct 25.
For the quarter under review, the Zacks Consensus Estimate for revenues is pegged at $58.35 billion, indicating an improvement of 8.8% from the year-ago reported number.
The consensus mark for earnings is pegged at $1.25, indicating a 10.7% fall from the previous year’s reported number. The estimated figure has been stable over the past 30 days.
GOOGL’s bottom line surpassed the Zacks Consensus Estimate in two of the trailing four quarters and missed the same twice, delivering an earnings surprise of 6.8%, on average.
Alphabet Inc. Price and EPS Surprise
Alphabet Inc. price-eps-surprise | Alphabet Inc. Quote
Search, Ad, YouTube & Cloud Momentum: Key Catalysts
Alphabet’s robust Search segment continues to be the key catalyst for its top-line growth. Its expanding ad services portfolio, a strong search engine and improving search results are likely to have benefited its third-quarter performance.
We believe that GOOGL’s continued efforts toward advancing its Search segment are expected to have driven traffic on its platform in the third quarter.
Technical advancements in Google Assistant and Google Maps are expected to have boosted momentum across search further. This is expected to have contributed well to the performance of Google Services in the quarter under review.
The growing momentum across its mobile search is anticipated to have been another positive.
Google’s growing investments in AI are likely to have continued benefiting its advertisement business and enhancing search results in the to-be-reported quarter.
Solid adoption of Alphabet’s innovative products like Search Ads and Google Lens might have aided growth in Search revenues. Further, growing momentum in the new feature called Multisearch, which helps people find what they need using words and images at the same time, remains a positive.
Strengthening momentum across YouTube Shorts is expected to have driven consistent growth in the subscriber base on YouTube in the third quarter.
Coming to cloud prospects, Alphabet has been significantly gaining momentum in the highly competitive cloud market for a while on the back of its expanding cloud service portfolio and an increasing number of data centers.
The impacts of GOOGL’s go-to-market strategy, and strengthening cloud infrastructure and ecosystem are expected to get reflected in its third-quarter revenues.
The solid adoption of the Google Cloud Platform and Google Workspace is likely to have contributed well to the performance of the Google Cloud segment in the to-be-reported quarter. Also, growing momentum in the data cloud market might have been a positive.
Android, Meet, Waymo and Cybersecurity Efforts to Consider
Google’s strength across Android, Meet and autonomous driving is anticipated to have aided its third-quarter performance.
The growing momentum across Android 12 is likely to have benefited Alphabet’s performance in the to-be-reported quarter.
Google’s growing efforts to advance its video conferencing software Google Meet with new user-friendly features are likely to have bolstered its user base in the quarter to be reported. Alphabet rolled out an account-switching feature on Google Meet for users with multiple accounts on their devices in the third quarter.
Alphabet also updated Meet with a default link-handling capability so that meeting links open in the new Google Meet app instead of Meet (Original).
The growing prospects around Alphabet’s self-driving unit Waymo are expected to have been other major tailwinds. The impacts of GOOGL’s efforts toward expanding its Early Rider program called Waymo One Trusted Tester across the United States are likely to get reflected in the upcoming results. In the third quarter, Waymo started testing its self-driving vehicles on the streets of Bellevue, WA.
The impacts of growing cybersecurity efforts are likely to get reflected in Alphabet’s third-quarter results. Google completed the acquisition of Mandiant in the third quarter.
Mandiant offers advanced capabilities and threat intelligence services that help organizations combat cyberattacks. This buyout is expected to have contributed well to GOOGL’s third-quarter performance.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for Alphabet this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Alphabet has an Earnings ESP of -2.07% and a Zacks Rank #3 at present.
Stocks to Consider
Here are some stocks worth considering, as our model shows that these have the right combination of elements to beat on earnings this season.
Cognizant Technology Solutions (CTSH - Free Report) has an Earnings ESP of +0.95% and a Zacks Rank #3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Cognizant is set to report third-quarter 2022 results on Nov 2. The Zacks Consensus Estimate for CTSH’s earnings is pegged at $1.17 per share, suggesting an increase of 10.4% from the prior-year quarter’s reported figure.
Benefitfocus has an Earnings ESP of +2.32% and a Zacks Rank of 3 at present.
Benefitfocus is scheduled to release third-quarter fiscal 2022 results on Nov 2. The Zacks Consensus Estimate for BNFT’s loss is pegged at 14 cents per share, which is narrower than the prior-year quarter’s reported loss of 19 cents per share.
CDW (CDW - Free Report) has an Earnings ESP of +0.31% and is Zacks #3 Ranked at present.
CDW is expected to release third-quarter 2022 results on Nov 2. The Zacks Consensus Estimate for CDW’s earnings is pegged at $2.52 per share, suggesting an increase of 18.3% from the year-ago quarter’s reported figure.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.