Google parent Alphabet Inc. reported quarterly sales that topped Wall Street estimates, powered by an increase in digital ad spending by businesses looking to expand during the pandemic reopening. The company also unveiled a big new share buyback, sending the stock up almost 5% in extended trading.
COVID-19 restrictions have limited travel and trips to physical stores, two key areas of Google’s search business. However, Alphabet shares are up about 30% this year on optimism that vaccinations in the U.S. will revive these activities. The company is also pushing further into e-commerce but still lags behind rival Amazon.com Inc.
Ruth Porat, chief financial officer, said the results “reflect elevated consumer activity online and broad based growth in advertiser revenue.” Chief Executive Sundar Pichai is trying to expand beyond the advertising engine that generates most of Alphabet’s revenue, while contending with a regulatory backlash that includes three government antitrust suits targeting different parts of its business in the U.S. He’s also preparing to bring employees back to the office in September.