Alphabet (the parent company of Google) has approved plans for a 20-for-1 stock split as part of the tech company’s quarterly earnings statement on Tuesday.
This indicates that the stock of Alphabet rose by more than 9% after market.
Note that Apple split its stock in the past year and a half, giving each shareholder three shares for each of their shares.
The market capitalizations of Apple and Alphabet are among the few that reached trillions of dollars, as investors go for profitable growth.
According to the earnings statement, Alphabet intends to split its Class A, Class B, and Class C shares. Shareholders will need to approve the change.
For each share of the same class of stock owned by each shareholder at the close of business on July 1, they will receive 19 additional shares on July 15.
Class C shares were added to Google’s stock in 2012, but they do not carry voting rights.
Founders and early investors already held Class A shares, which carry one vote each, and Class B shares, which carry 10 votes each. Throughout its 2015 rebrand to Alphabet, the company maintained its stock structure.
Consequently, Advertising revenues for Google for the quarter totaled $61.24 billion, a 33% increase from $46.2 billion for the same period a year prior.
Google’s chief business officer, Philipp Schindler, said retail was the leading source of year-over-year growth in ads. Finance and media spending also increased.
Analysts’ expectations were not met for YouTube ad revenue. The company has been challenging TikTok with a service called Shorts.
According to Sundar Pichai, CEO of Alphabet, more than 1.5 billion people use the company every day. That number remains unchanged from his July 2021 update.
Cloud revenue for the company grew by 45% to $5.54 billion. During the quarter, operating losses in the cloud sector fell from $1.14 billion to $890 million.
From the third quarter, when the unit lost $644 million, it expanded.
According to Google, the company’s other revenue segment, which includes hardware, Play Store, and non-advertising YouTube revenue, did $8.16 billion in sales last year, up from $6.67 billion the previous year. Despite supply chain constraints, Pixel saw an “all-time record” in sales, said Pichai.
