Google Parent Alphabet Profit Rises, But Misses Street; Shares Down 6%

(RTTNews) - Alphabet Inc., (GOOG, GOOGL), the parent company of Google, Thursday reported an increase in profit for the first quarter, driven mostly by increase in search and advertising revenues.

Both earnings and revenues for the quarter fell shy of Wall Street analysts' estimates, sending shares of Alphabet down by 6 percent in the after-hours trading.

"Our Q1 results represent a tremendous start to the year with 17% revenue growth year on year and 23% growth on a constant currency basis. We're thoughtfully pursuing big bets and building exciting new technologies, in Google and our Other Bets, that position us well for long term growth," said Ruth Porat, CFO of Alphabet.

Last August, Google announced its plans to create a new public holding company, Alphabet, and a new operating structure.

Alphabet's first-quarter profit rose to $4.21 billion or $6.02 per share from $3.52 billion or $5.10 per share.

Adjusted earnings for the quarter rose to $7.50 per share from $6.47 per share last year. On average, 38 analysts polled by Thomson Reuters estimated earnings of $7.96 per share for the quarter.

Revenues for the quarter grew 17 percent to $20.26 billion from $17.26 billion last year. Analysts had a consensus revenue estimate of $20.38 billion for the quarter.

Google said aggregate paid clicks increased 29 percent year-over-year, while aggregate cost-per-click fell 9 percent year-over-year.

On Wednesday, the European regulators charged Google with using its dominant Android mobile operating platform to boost its mobile advertising revenues. EU alleged that Google stifled competition by asking phone manufacturers to pre-install Google Search and the Google Chrome browser on Android phones.

GOOG closed Thursday's trading at $759.14, up $6.47 or 0.86%, on the Nasdaq. The stock, however, dropped $37.74 or 4.97% in the after-hours trade.