Alphabet Falls More Than 10% After Hours Despite 25% Third-Quarter Revenue Growth
Key Facts
Alphabet shares fell more than 10% to $289.95 in after-hours trading on October 28, after the company reported third-quarter results with revenue below the Wall Street average forecast, according to The Associated Press. The company had ended the regular session at $324.89, up from $320.58 in the previous session, according to EL7 data. The difference between the two prices highlights that the after-hours decline came after regular trading ended and does not reflect the stock’s recorded closing price that day. Revenue totaled $127.58 billion from July to September, up 25% year over year. But the average analyst forecast was $127.97 billion, leaving strong growth insufficient to meet market estimates.
Google Cloud posted the strongest growth among the operating figures reported, with revenue rising 103% year over year to $30.7 billion, a record increase, according to The Associated Press. In search and other advertising, revenue rose 12% to $63.3 billion. YouTube advertising revenue also increased 9% to $11.2 billion. The results show continued growth in search and advertising alongside rapid expansion in cloud computing. But the earnings announcement was followed by a decline in the stock in subsequent trading, while the revenue shortfall against analyst expectations and the investment loss were among the results’ most notable figures.
Alphabet’s results included an $8.7 billion loss on equity investments, reducing earnings per share by 55 cents, according to The Associated Press. On cash flow, free cash flow was negative $9.07 billion in the third quarter, compared with a $5.9 billion deficit in the second quarter, according to Reuters. The widening cash deficit came alongside the investment loss as the company faces questions about the cost of its AI-related expansion. The chief financial officer said the company still expects “capital spending to increase significantly” in 2027. She added that the company would provide further details during its fourth-quarter earnings call, according to The Associated Press.
In Japan, Nomura Holdings announced an interim dividend of 35 yen per share for the fiscal year ending in March 2027, compared with 27 yen in the corresponding period of the previous fiscal year. The company said the increase was 8 yen per share and set December 1, 2026, as the start of payment. NMR shares ended the October 28 session at $9.12, compared with $9.11 the previous day, according to EL7 data. This limited move puts the closing price in context, while the company’s documented news centers on the higher interim dividend. Nomura’s investor-relations calendar lists January as the date for announcing third-quarter results for fiscal 2027, without specifying a day.