Alphabet’s second-quarter earnings report will be driven first by its ad revenue and second by its platforms, and will be plagued by antitrust allegations, according to experts.
In April, slower growth in advertising bogged down the company’s first-quarter earnings report. Shares fell after Alphabet released disappointing Q1 earnings, reporting lower revenue than expected and overall decelerating growth.
The tech giant has taken strides to repair that hole this quarter. On May 3, they introduced a new feature that embeds shopping links underneath YouTube videos, with a picture and price of a recommended product. The link brings users to Google Express, where they can make the purchase.
Alphabet has also expanded its online shopping programs by introducing innovations such as AR Beauty Try-On, which was announced on June 19. The AR provides an immersive experience for potential shoppers, allowing users to try beauty products virtually while watching YouTubers give advice, product reviews and more.
Google’s parent company is attempting to take on Amazon and Facebook by implementing new tools for businesses, such as Google My Business. Aiming to compete with Facebook Pages, the feature helps customers and businesses connect.
In the payments world, Google has continued to expand Google Pay, adding support for 26 new U.S. banks over the month of July and integrating PayPal into its system in June. However, they also ended their peer-to-peer component in the U.K. last month.
Alphabet’s earnings were also partially affected by a $1.7 billion fine from the European Commission on anti-competitive grounds, a hit that will continue to be a threat as legal bodies investigate and regulate Big Tech.
The Retail Industry Leaders Association (RILA) on July 2 voiced the desire to speak with the Justice Department and the Federal Trade Commission (FTC) regarding their concerns about Google and Amazon’s anti-competitive practices. RILA, which includes companies such as Target, Walmart and Best Buy, accused the two tech companies of creating an “information bottleneck.”
Google continues to struggle with privacy concerns as well – from data leaks to a report that they store users’ purchase histories on Gmail – but has doubled down on protesting talks of regulating tech companies, claiming there could be “unintended consequences.” The Internet Association, of which Google is a member, called the U.K.’s proposed “duty of care” rules too broad, ineffective in protecting privacy and a threat to freedom of speech.
Nevertheless, Google has made some efforts toward their new proposed commitment to privacy, announcing in May the addition of a widget to the Chrome browser that would limit tracking cookies and provide users with more information on how they are being tracked and how they can prevent that data collection.
The company has also announced the opening of the Google Safety Engineering Center in Munich, where many of their privacy products have been designed. They plan to double the number of privacy engineers in the city to more than 200.
Alphabet will release its second-quarter earnings on Thursday (July 25) and will host a conference call at 4:30 p.m. EST to discuss the report.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Learn More