Alphabet’s Operating Cash Flow was Up 47.6% in 2023 Q2

Alphabet (NASDAQ: GOOGL) announced its 2023 Q2 financial results on July 25, 2023. According to the announcement, revenues were up 7.1% (YoY, 3 months). On the other hand, income from operations was up 12.3% and net income was up 14.8% (YoY, 3 months).

Looking at revenue growth by services, Google Cloud showed the highest growth of up 28.0% (YoY, 3 months). Google Search & other followed this with up 4.8%. Meanwhile, Google Network showed the biggest slowdown at down 5.0%. YouTube ads showed moderate growth of up 4.4%.

A woman bearing a note PC is standing in front of a server room
Photo by Christina @ on Unsplash

As for segment margin, Google Services recorded 34.4% (3 months). However, the other business segments are recording operating losses. It would be desired that these segments including Google cloud become profitable. 

Looking at geographical revenue trends, APAC showed the highest growth of up 8.7% (YoY, 3 months, USD). It was followed by EMEA of up 8.6%. Revenue in United States was up 7.2%, and that in Other America was up 4.9%.

As you can see, Alphabet’s revenue growth has been slowed down to single digits growth after 2022 Q2. However, the company has been cutting costs since 2023 Q1. As a result, net cash provided by operating activities was up 47.6% on year-over-year basis (3 months). It was up 14.2% on quarter-over-quarter basis.

As for free cash flow, the company recorded cash inflow of 17,866 million USD, up 17.3% year-over-year basis. However, FCF was down 13.1% quarter-over-quarter basis.

In general, Alphabet’s stock price trend at least after the COVID-19 pandemic is highly correlated with the trend of operating cash flow of the previous quarter. Alphabet’s strong growth in the operating cash flow in 2023 Q2 could give an optimistic outlook for the company’s future stock price trend.

Alphabet Inc. (NASDAQ: GOOGL) Stock Chart

Important Notice 

  1. Watanabe & Brothers’ Investment is holding shares of Alphabet. 
  2. This report is provided solely for informational purpose and not intended for the purpose of soliciting investment in, or as a recommendation to purchase or sell any specific products. 
  3. Any opinions or statements expressed in this report are based on the author’s personal and subjective views, and are not the official views of the organization to which the author belongs.  In addition, although we have done our best efforts in making accurate assessments on the original financial statements, we cannot guarantee any complete accuracy of this report. We do not guarantee either that any future forecasts referred to in this report will certainly be realized. Investment in listed stocks, ETFs, etc. should be carried out under the responsibility of each investor, and even if the investor who read this report suffers a loss due to investment activities, Watanabe & Brothers’  Investment is not responsible for any liability.
  4. This report was originally prepared in English, and translated into the other languages with plugin utilizing Google Translation API. We hereby notify that the translations are provided only for the sake of reference, and any opinions or statements in this report should be interpreted in original English. We ask any investors reading this report to refer to the original financial statements issued by the company.
%d bloggers like this: