This year continues to be unfavorable for businesses with falling stock prices, economic downturns and fears of recession, financial crisis, slowing growth, rising inflation and interest rates and other adverse macroeconomic factors in the market. That, combined with a drop in PC and smartphone shipments, made the September quarter difficult for major tech companies around the world. Alphabet, the parent of Google, was one of the many names that took a beating this year, and its performance in the third quarter of the year reflected the same.

Alphabet reported revenue of $69.09 billion for the quarter ended Sept. 30, 2022, which was below estimates of $70.58 billion and up 6% year-over-year. This marks the company’s slowest growth rate since 2013 (which may be a recurring theme for the recently concluded quarter).

However, net profit for the same period fell 27% year-on-year (y-o-y), while earnings per share (EPS) fell well below analysts’ estimates to $1.06 per share. Operating income for the same period fell to $17 billion.

Overall, parent company Google collected $206 billion in revenue for the year ended September 30, 2022, while total costs and expenses for the period rose to $150 billion. Its revenue from operations for the year ended September totaled $56.68 billion, while its net income fell year-on-year to $46.3 billion.

The company’s shares fell about 7% in extended trading on Tuesday after the earnings report was shared, falling below $97 and currently trading at $96.82.

“We are sharpening our focus on a clear set of product and business priorities. The product announcements we’ve made in the last month alone have made this abundantly clear, including significant AI-powered improvements to both Search and Cloud, and new ways to monetize YouTube Shorts. We are focused on both investing responsibly for the long term and being responsive to the economic environment,” said Sundar Pichai, CEO of Google and Alphabet.

At a time when advertisers are cutting back on spending, Google’s ad division raked in $54.48 billion in the quarter — up year-over-year but rather sluggish. Both YouTube and Google’s network ad revenue saw year-over-year declines, reaching $7 billion and $7.8 billion, respectively.

According to Philip Schindler, Google’s chief business officer for Google, there has been a pullback in search ad spending from certain areas such as insurance, loans, mortgages and cryptocurrencies.

Google’s Cloud — which includes Google’s infrastructure and platform services and others — and Other Betting divisions — which includes several operating segments — saw growth in the third quarter of the year, but their revenues reflected the same, at $6.8 billion and $209 million, respectively. dollars. However, their operating losses widened for the quarter as well, with Google Cloud and Other Bets posting losses of $0.69 billion and $1.6 billion, respectively.

Going forward, Alphabet intends to “realign resources to fuel our highest growth priorities,” as well as add to its headcount at a slower pace than usual — it plans to “add fewer than half the employees in the fourth quarter , than he did in the third” and to continue recruiting critical roles in the coming year.