Google owner valued at $2 trillion

GOOGLE’S parent company soared past a $2trillion (£1.6trillion) valuation last night as the search engine giant said it would pay a dividend for the first time.

Shares in Alphabet rose by more than 12pc to a record high as the company announced the payout to shareholders, alongside a $70bn (£56bn) share buyback scheme.

Microsoft shares also rose after the world’s most valuable company revealed record profits. It meant both tech giants shrugged off a tech sell-off earlier in the day triggered by fears about the artificial intelligence (AI) boom.

Alphabet reported revenues of $80.5bn for the first quarter of the year, a 15pc rise, and said profits had climbed by 57pc to $23.7bn.

It said it would pay shareholders a quarterly dividend of 20 cents a share, amounting to a payout of more than $2.5bn, and that it planned to continue paying quarterly cash dividends in the future. It comes after Meta said it would pay its first dividend in February.

Microsoft shares climbed by more than 5pc after sales jumped on growing demand for its AI technology. Quarterly revenues rose 17pc to $61.9bn while profits were up 20pc, at $21.9bn.

Google has faced questions about whether it is falling behind companies such as Openai, the maker of the popular CHATGPT chatbot, as well as concerns that the rise of AI could threaten its lucrative search engine.

Microsoft, meanwhile, has been seen as one of the biggest beneficiaries of the CHATGPT craze. It is a major investor in Openai and overtook Apple as the world’s most valuable listed company earlier this year. But investors had questioned whether the hype and heavy spending around AI is turning into tangible revenues.

The figures came after a wider tech sell-off earlier in the day after Facebook owner Meta reported disappointing results on Wednesday. Meta’s chief executive Mark Zuckerberg saw his personal wealth drop by more than $17bn to about $150bn after Meta’s stock plunged by 10pc.