Alphabetannounced its first-ever dividend on Thursday and a $70 billion stock buyback, cheering investors who sent the stock surging nearly 16% after the bell.
The Google parent is returning capital while spending billions of dollars on data centers to catch up with rivals on generative artificial intelligence. The dividend will be 20 cents per share.
Just three months ago, Alphabet’s Big Tech rival, Meta Platforms, announced its own first-ever dividend, a move that lifted the social media company’s stock market value by $196 billion the following day. Amazon remains the lone holdout among Big Tech firms not offering a dividend.
Alphabet beat expectations for the quarter in sales, profit and advertising – metrics that are all closely watched.
“Alphabet’s announced dividend payouts and buybacks on top of the solid earnings beat are not only a breath of fresh air for the tech market as a whole, but also a very intelligent strategy for the search engine giant going into a tough time of the year,” said Thomas Monteiro, senior analyst at Investing.com.
Alphabet’s after-hours share surge of nearly 16% following the report increased its stock market value by about $300 billion to over $2 trillion.
In a call to discuss results, CEO Sundar Pichai touted Google’s AI offerings as a boon to its core search results. “We are encouraged that we are seeing an increase in search usage among people who are using the AI overviews,” he said.
Revenue was $80.54 billion for the quarter ended March 31, compared with estimates of $78.59 billion, according to LSEG data.
The search firm’s beat on first-quarter revenue was powered by rising demand for its cloud services on the back of increasing adoption of artificial intelligence and steady advertising spending.
Google reported advertising sales rose 13% in the quarter to $61.7 billion. That compares with the average estimate of $60.2 billion, according to LSEG data.
Alphabet is coming off a fourth quarter in which ad sales missed the mark, sending shares tumbling, amid rising competition from Amazon, Facebook and new entrants like TikTok. The latter faces an uncertain future after President Biden signed a bill that would ban the popular app if it is not sold within the next nine to 12 months.
Meanwhile, Google Cloud revenue grew 28% in the first quarter, boosted by a boom in generative AI tools that rely on cloud services to deliver the technology to customers.
Alphabet’s capital expenditures were $12 billion, a 91% rise from a year prior, a figure Gabelli Funds portfolio manager Hanna Howard called “higher than anticipated.”
Still, CFO Ruth Porat said on the call with analysts that she expects such expenditures to be at that level or higher throughout the remainder of the year, as the company spends to build artificial-intelligence offerings.
Despite the surge in capital expenditures, Porat said operating margin in 2024 would be higher than last year, without elaborating.
Google’s cloud services are attractive for venture capital-backed startups developing generative AI technologies due to their pricing and ease of integration with other tools, investors and experts have previously said.
Google has touted its AI-powered chatbot, Gemini, as a panacea for automation, from coding to document creation. The software was widely criticized, however, after it was found to generate historically inaccurate images, including of former US leaders and World War Two-era German soldiers.
Google has said it is aware of the issues and is working to address them.
Actor and comedian Chris O’Dowd has described moving back to London from the US, finding people in the city are “down” after a decade of cutbacks.
The IT Crowd star returned to London from Los Angeles with his wife Dawn O’Porter and their two children a year ago.
“It’s just gone through 10 years of austerity, and you can feel it off it,” he told Sky News.
“People are down, is the impression I’m getting. I don’t know if it’s because of the divisive political culture or whether it’s because people are broke as s**t because they haven’t put any money into public services for so long, and now they’ve said they’re not going to do it either because they’re not going to raise taxes, so I don’t know what they’re going to do. But everybody is… it would be hard to say it’s improved.”
Asked if he sensed any optimism that things would change for the better, he replied: “Not yet.”
O’Dowd said the decision to return to the UK “wasn’t because Trump got in or any of that crap”, but that he wanted to “get out before the political cycle starts, because it just gets a bit heated”. He added: “It actually didn’t this time, because he won so easily.”
The Irish star was speaking ahead of the premiere of his new Sky Original series Small Town, Big Story, which comes to Sky and NOW on Thursday 27 February.
Image: Chris O’Dowd and Christina Hendricks in Small Town, Big Story
Set in the fictional Irish border village of Drumban, the dramatic comedy follows Wendy Patterson, portrayed by Mad Men’s Christina Hendricks, a local girl who found success as a TV producer in Los Angeles. She returns with a film crew in tow and is forced to confront a secret from decades ago – visitors from outer space.
So does the show’s creator believe in alien existence?
“I find it hard to believe we’re it, we’re just too imperfect,” O’Dowd replied. He hails from Boyle, County Roscommon, which is considered a “UFO hotspot” in Ireland.
“In the vastness of the universe, or the multiverse or whatever we’re existing within, it seems highly unlikely that you and me are the best we can do, no offence,” he added.
Image: The cast of Small Town, Big Story
Patterson’s show-within-a-show, titled I Am Celt but described as Lame Of Thrones, appears to satirise Hollywood’s often inaccurate portrayal of Ireland.
“Some of them can be heavy-handed, or a little bit off-piste,” laughs O’Dowd. “I think the thing to remember is we’re guilty of it too.
“Whenever I hear Americans being depicted from Irish people, very often they’re stuffing themselves with cheeseburgers and they’re morons. There’s got to be a bit of give and take with that.”
Pope Francis is in a critical condition after a “prolonged respiratory crisis” that required a high-flow of oxygen and is “suffering more than yesterday”, the Vatican has said.
In an update on Saturday evening, the Vatican said “the Holy Father’s condition continues to be critical”, adding that this morning he “presented with a prolonged asthmatic respiratory crisis” which required the application of high-flow oxygen.
He also had blood transfusions after tests revealed thrombocytopenia, which is associated with anaemia.
“The Holy Father continues to be vigilant and spent the day in an armchair even though he was suffering more than yesterday. At the moment the prognosis is reserved,” the Vatican’s statement said.
In an update earlier on Saturday morning – the shortest since Francis was admitted to hospital on 14 February – the Vatican said he will not lead Sunday prayers for the second week running, adding: “The Pope rested well.”
Francis is likely to prepare a written homily for someone else to read at Sunday’s Angelus.
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Image: The Pope before entering hospital. Pic: AP
Millions of people around the world have been concerned about the Pope’s increasingly frail health – and his condition has given rise to speculation over a possible resignation, which the Vatican has not commented on.
Doctors on Friday said he was “not out of danger” and was expected to remain at Rome’s Gemelli hospital for at least another week.
Sergio Alfieri, the chief of the pontiff’s medical team, said: “Is he out of danger? No. But if the question is ‘is he in danger of death’, the answer is ‘no’.”
Image: Sergio Alfieri (R) said Pope Francis was a ‘fragile patient’ but was in ‘good spirits’. Pic: AP
He said Francis was affected by seasonal flu before being taken to hospital and that, “due to his challenging duties”, he had suffered fatigue.
He is also fighting a multipronged infection of bacteria and viruses in the respiratory tract.
Image: A woman places a rosary at the statue of the late Pope John Paul II outside Rome’s Gemelli Hospital, where Pope Francis is being treated. Pic AP
The doctors warned that while he did not have sepsis – where germs enter the bloodstream – there was always a risk the infection could spread in his body, and they said that was the biggest concern.
Sepsis is a complication of an infection that can lead to organ failure and death.
Pope Francis has a history of respiratory illness, having lost part of one of his lungs to pleurisy as a young man. He had an acute case of pneumonia in 2023.
The release of more than 600 Palestinian prisoners planned for Saturday has been postponed “until the release of the next hostages is secured without humiliating ceremonies”, Israel has said.
In a statement early on Sunday, Prime Minister Benjamin Netanyahu‘s office accused the Palestinian militant group Hamas of “repeated violations” as it lashed out at “disgraceful ceremonies” during the handover of Israeli captives in Gaza.
The Israeli PM’s office said: “In light of the repeated and ongoing violations by Hamas – including the disgraceful ceremonies that dishonour the dignity of our abductees and the cynical use of captives for propaganda purposes – it has been decided to postpone the release of the terrorists that was planned for yesterday until the release of the next group of abductees is secured, and without the humiliating ceremonies.”
The statement came as vehicles apparently carrying prisoners left the open gates of Ofer prison in the occupied West Bank, only to turn around and go back in.
Image: Israeli forces at Ofer prison in the West Bank
The release of 620 Palestinian prisoners had been delayed for several hours and was meant to happen after six Israeli hostages were released on Saturday.
Five of the six captives were escorted by masked, armed militants in front of crowds – displays that the United Nations and others have criticised as cruel after previous handovers.
The final hostage was released to the Red Cross in private.
The Gaza ceasefire deal continues to hold, despite tensions rising earlier in the week when Hamas initially handed over the body of an unidentified Palestinian woman instead of Israeli mother-of-two Shiri Bibas.
The hostage-prisoner exchange earmarked for Saturday was supposed to be the last for the first phase of the ceasefire.
Israel had been expected to free hundreds of Palestinian prisoners on Saturday, including a man who has been detained for more than 40 years, and many more given life sentences.
However, as night fell across the region, they remained behind bars, with Hamas claiming their release had been delayed because some of them had been “assaulted”.
An Israeli spokesperson has denied the assaults and said the Red Cross were present at the prison.
The first two hostages released on Saturday were Tal Shoham and Avera Mengistu.
Mr Shoham, 40, was visiting his wife’s family in Kibbutz Be’eri when Hamas militants stormed into the community during the October 7 attacks in 2023.
His wife, two young children and three other relatives were also abducted, but they were freed in an exchange in November 2023.
Image: Abra Mengistu hugs his family in Israel after his release. Pic: IDF
Mr Mengistu, a 39-year-old Ethiopian-Israeli, had been held in Gaza since he entered the territory on his own in 2014.
Watching the moment he was freed on TV, his family broke out in song as he walked free for the first time in more than a decade.
Later on Saturday, Eliya Cohen, Omer Shem Tov and Omer Wenkert were handed over to the Red Cross in Nuseirat, central Gaza.
Image: Omer Shem Tov, a hostage held in Gaza since October 2023, pictured as he is released. Pic: Reuters
Mr Shem Tov, 22, was taken during the October 7 attacks on the Nova music festival.
The computer programmer had shared his live location with his family, who eventually noticed he was headed towards Gaza and contact with him was lost.
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Hostage reunited with parents
Mr Cohen, 27, was also taken from the Nova festival, alongside his fiancee.
Released hostages have said that he was kept in chains and deprived of food and sunlight during his time in captivity, according to reports.
Mr Wenkert, 23, was taken from Nova. He suffers from colitis and requires special medical care, it has been reported.
Finally, Hisham al Sayed, 28, was handed over in a private ceremony.
The Bedouin-Israeli, from the village of Hura in the Negev desert, has been a captive since he crossed into Gaza in 2015.
Image: Nael Barghouti pictured in 2011. Pic: Reuters
Who were the Palestinian prisoners due to be released?
More than 600 Palestinian prisoners had been set to be released on Saturday.
According to the prisons office, which is run by Hamas, they included 50 who had been sentenced to life imprisonment, 60 described as having “high” sentences, 47 prisoners from the “Wafa al Ahrar” 2011 prisoner exchange deal who had since been re-arrested, and 445 who were arrested after 7 October attacks.
The “Wafa al-Ahrar” deal was the 2011 prisoner exchange agreement that saw the release of captured Israeli soldier Gilad Shalit in exchange for 1027 Palestinian prisoners.
Among the most high-profile Palestinians who had been set to be released was Nael Barghouti – the longest-serving prisoner, who has been inside for 43 years.
Also on the list were several journalists, many of whom covered events at al Shifa hospital, and Yousef al Mansi, a Palestinian minister in Gaza.
It had been expected that Dr Hussam Abu Safiya, the director of Kamal Adwan Hospital in Gaza, would be among those being released on Saturday.
However it later emerged that he was not on the list of those set to be freed.