Alphabet shares jump as ad, Cloud sales soar amid pandemic.

Google parent Alphabet Inc. on Tuesday reported record revenue for the secondstraight quarter despite the pandemic, driving shares up six per cent as it topped estimates for both advertising and Cloud sales as customers unleashed budgets for the holidays.

Cutbacks by travel and entertainment advertisers in 2020 were nearly made up as the year went on by new spending from retail clients and others that were driven online by COVID-19 lockdowns.

Google's advertising business, including YouTube, accounted for 81 per cent of Alphabet's US$56.9 billion in fourth-quarter sales, which rose 23 per cent compared with a year ago.

Google's Cloud unit also benefited from the pandemic. Google Cloud sales were US$3.83 billion, or US$13.1 billion for the full year, up 46 per cent from 2019.

Analysts tracked by Refinitiv had estimated quarterly revenue of US$53.1 billion and Cloud sales of US$3.82 billion.

In a new disclosure, Alphabet said Google Cloud posted an operating loss of US$1.24 billion in the fourth quarter and US$5.6 billion for 2020, a 21-per-cent wider loss than in 2019.

Google, which generates more revenue from internet advertising than any company globally, has long faced questions over whether it can spin the cash from its advertising business into a newly profitable venture. The new financial details suggest that goal still may be years away.

Alphabet's quarterly profit rose 43 per cent to US$15.2 billion, or US$22.30 per share, compared with the average estimate of US$10.895 billion, or US$15.95 per share.

Alphabet shares rose six per cent to US$2,035.95 in after-hours trading on Tuesday.

The stock has risen by 9.5 per cent so far this year.

Though Alphabet increased its cash hoard by US$17 billion in 2020 to US$137 billion, investors continue to scrutinize its growing expenses.

Alphabet's costs to license programming for YouTube, operate data centres and stock consumer products have soared in recent years. Those other costs of revenue now account for about 27 cents for every US$1 in sales, up from 23 cents four years ago.