Alphabet Inc (NASDAQ:GOOG) missed estimates in both profit and revenue in its fourth quarter as YouTube ad spending slowed.
For the three-month period to end December 31, 2022, the technology company delivered $76 billion in revenue versus the $76.6 billion expected by analysts.
The bottom line was hurt by YouTube ad spending, which reached $7.96 billion compared to estimates of around $8.3 billion.
READ: Google to axe 12,000 jobs as tech sector purge continues
Google Cloud revenue was a small bright spot at $7.32 billion, just ahead of revised Street expectations of $7.3 billion.
All told, Alphabet’s earnings per share of $1.05 missed average expectations of around $1.19, sending shares down nearly 5% in afterhours trading on Thursday.
Sundar Pichai, Alphabet’s CEO, told shareholders that the company is “on an important journey to re-engineer our cost structure in a durable way and to build financially sustainable, vibrant, growing businesses across Alphabet.”
CFO Ruth Porat added that there is “significant work underway” to improve all aspects of its cost structure, in support of investments in growth to deliver long-term, profitable growth.
Earlier in January analysts at Oppenheimer & Co Inc lowered their revenue expectations for Alphabet’s Google Cloud Platform segment while raising their 2023 operating income expectations.
The move came as Alphabet joined its Big Tech peers in cutting thousands of jobs in the latest round of cost-cutting measures in the global tech sector.
Around 12,000 people from offices around the world were laid off, which amounts to around 6% of its workforce.
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