Alphabet Says Q4 Was "Exceptional" With 22% Revenue Increase

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Alphabet says their Q4 was “exceptional” with a 22% revenue increase year on year, the company has stated today in a report detailing their fourth quarter results for the 2016 fiscal year. This included $26.064 million in revenue in the three months that make up the fourth quarter from last year, which ended on December 31st. This is compared to $21.329 million in the same three months that made up the fourth quarter for 2015. The 22% increase is a slight bump over the increase that Google saw year on year from 2014 to 2015, which was an increase of revenues by 18% at that time.

Alphabet’s GAAP operating income rose from $5.38 million in the fourth quarter of 2015 to $6.639 million in the fourth quarter of 2016, while while their operating margin stayed situated firmly at 25%. While Alphabet saw an increase in revenue from this past year’s fourth quarter, they also saw an increase in cost of revenue from 2015 to 2016, as they reported a cost of revenue for Q4 2016 at $10.661 million, which is $2.473 million higher than their cost of revenue following the fourth quarter of 2015 which is reported at a total of $8.188 million. Operating expenses other than their cost of revenues are also up, seeing a jump from $$7.761 million in 2015 to $8.764 million in 2016. Operating expenses as a percentage of their revenues went down though, as these were reported to be at 34% which is down 2% from 36% in 2015. This means that while their operating expenses went up in 2016 compared to 2015, the percentage of those operating expenses that came out of their revenues from the same quarter was not as high as the previous year, which more or less translates to them not having to spend as much on their operating costs from the money that they were bringing in during the same quarter.

Alphabet saw an increase across many of its Google revenues, reporting a rise in revenues for Google properties from $14.936 million in 2015 to $17.968 million in 2016, which was a 20% jump. The biggest percentage increase from Google revenues though came from “Google Other Revenues” which have a reported increase of 62%, jumping from $2.101 million in 2015 to $3.403 million in 2016. There was also an increase of Aggregate Paid Clicks which are the Google ads that people click on via the web, as Alphabet reports a 36% increase here from 2015 to 2016, and a 20% increase from Q3 of 2016 to Q4 of 2016. Alphabet states that their revenue increases were driven by mobile search and YouTube, though they’re also seeing a strong growth and momentum in Google’s “Other Bets” as well as Google’s other newer investments.