Alphabet’s Free Cash Flow was Up 45% in 2022 Q3

Alphabet (NASDAQ: GOOGL) announced its 2022 Q3 financial results on October 25, 2022. According to the announcement, revenues were up 6% (YoY, 3 months). 

On the other hand, operating income and net income were down 19% and 27%, respectively. In addition, operating margin recorded 25%, down about 70bp, year-over-year (3 months). The slowdown in revenue growth seems to be impacted by the strong US dollar.

Looking at changes of segment revenues, Google cloud segment recorded the largest growth of up 38%. It was followed by Google search and other of up 4% (YoY, 3 months). However, YouTube ads revenues were down 2%.

The sharp decline of Alphabet’s profit was at least partially driven by 34% increase in research and development. However, the most of the increase of costs and expenses was attributable to impairment of properties and increase of stock based compensation. As a result, it was reflected by slight decline (-9%) of net cash provided by operating activities (YoY, 3 months). Free cash flow was up 45% (YoY, 3 months), indicating the strong fundamental of Alphabet.  

Looking at revenues by region, United States revenues and the other Americas revenues each recorded the highest growth of up 12% (YoY, 3 months). On the other hand, EMEA revenues and APAC revenues were down 2%, respectively.

Alphabet Inc. (NASDAQ: GOOGL) Stock Chart

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