This rise builds on the gains enjoyed by the internet search company since late March, and shares are up around 18% year to date.
Alphabet had reported earnings for its fiscal third quarter, and the results reflected broad-based growth in advertising spend. Revenue rose 14% year over year to $46.2 billion, operating profit was up 22% year over year to $11.2 billion and net income surged 59% year over year to $11.2 billion. This strong set of earnings provides investors with confidence that growth is returning for the company despite the COVID-19 pandemic still raging around the world. It also reflects the increased shift toward online modes of communication as many parts of the world remain under lockdown or have imposed movement restrictions to contain the virus.
The company continues to enhance its service offerings, committing $1 billion in investments to license content from nearly 200 publishers around the world. Last month, new artificial intelligence and machine learning tools were embedded into Google's search service to account for misspellings and enhance the accuracy of search results. YouTube, the company's video service, now has more than 30 million Music and premium paid subscribers.
Alphabet now has to contend with an antitrust lawsuit filed by the Department of Justice last week. The suit alleges that the company has used business tactics to secure a monopoly for its search engine and suppressed attempts by smaller competitors to gain a foothold with their search engines. CEO Sundar Pichai said he believes Alphabet's products have significant customer benefits that make them a preferred choice among users. This lawsuit will probably not be the last that the company faces as it continues to grow and invites greater scrutiny.
No matter the outcome, Alphabet will continue to invest in making its services better for consumers. And as the pandemic drives a larger group of people to start using the internet, Alphabet should witness continued growth in the use of Google search, its cloud services, and YouTube.