Google Q4 revenue grew, but not enough for Wall Street

Google’s revenue grew, but Wall Street wanted more.

Parent company Alphabet’s stock fell nearly 5% after financial results came out Monday, even as profits beat expectations for the last three months of the year.

Helped by lower taxes, Alphabet said Monday it earned $10.7 billion, or $15.35 per share, up 19% from $8.9 billion, or $12.77 per share, a year earlier. That’s more than the $12.49 a share analysts polled by FactSet were expecting.

Net revenue, after subtracting advertising costs, was $37.6 billion, up 18% from $31.8 billion a year earlier. But analysts were looking for $38.4 billion.

This was the second rocky quarter in a row for the online search leader. Its third quarter brought higher-than-expected revenue but a profit shortfall due to higher spending on new hires, data centers and other expenses.

While Google is still the clear leader in the digital advertising market, it is seeing growing competition from the likes of Facebook and Amazon.

Google – and with it, Alphabet – makes the majority of its money from selling targeted advertising across the web, apps and

Google products including its search engine and video streaming site YouTube. Investors are now also closely watching the growth of Google’s cloud business and its aspirations in the health care industry. Google agreed to buy the fitness tracker company Fitbit in November.

Alphabet disclosed revenue for YouTube and its cloud business for the first time, something analysts have been seeking for years.

“The information should also give advertisers valuable information about the importance of YouTube as a digital ad vehicle,” eMarketer analyst Nicole Perrin said. (AP)