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Alphabet earns $5.1 billion in profits for Q3 2016, 'Other Bets' keep losing money
Google’s parent company, Alphabet, recorded $5.1 billion in net income for the third quarter of 2016 that ended on September 30. That’s up by 27 percent compared to the $3.9 billion it earned in the same time period from a year ago. Revenues came in at $22.5 billion for the quarter, up by $18.6 billion from the same period a year ago.
As you might expect, the majority of the revenues comes from Alphabet’s Google division. It brought it $22.2 billion in revenues for the third quarter, and operating income of $6.7 billion. All of Alphabet’s other businesses, which include Google Fiber, its self-driving car team, Nest and others, brought in just $197 million in revenue under the “Other Bets” section of the financial results. However, those divisions lost a combined $865 million in operating income for the quarter. On the (slightly) better side, that’s a step up from the $980 million it lost during the same period a year ago.
Alphabet is already looking to trim the fat on its other companies that are not Google. Earlier this week, the company revealed that it was pausing its expansion of the Google Fiber 1Gbps internet and TV service in the US and laying off an unknown number of employees. We will have to see if any of those other businesses will also get cut.
Alphabet also broke down Google’s own revenues for the quarter, revealing that it generated a total of $19.8 billion in revenues in ads from its websites and from its Network Members websites. Revenues from its other businesses, which include its hardware and the Google Play Store, totaled $2.4 billion for the quarter. That number could go up in the current fourth quarter thanks to the launch of the new Pixel and Pixel XL phones, along with the new Daydream View, Google WiFi, Chromecast Ultra and Google Home devices.