Markets Can Keep Working Even While FANG Stocks Stumble

Alphabet, the parent company of Google, bested fourth-quarter earnings expectations, but the stock fell amid worries regarding the costs of digital advertising prices and declining margins.

Final earnings report figures:

  • Earnings: $12.77 per share versus $10.82 according to Refinitiv consensus estimates
  • Revenue: $39.28 billion versus $38.93 billion according to Refinitiv consensus estimates
  • Traffic acquisition costs: $7.44 billion versus $7.62 billion according to StreetAccount

“Everything we do at Google is united by the mission of making information accessible and useful for everyone. Providing accurate and trusted information at the scale the Internet has reached is an extremely complex challenge and one that is constantly getting harder,” said CEO Sundar Pichai during the earnings call.

However, capital expenditures exceeded $7 million while the company reported an operating margin of 21 percent, which was lower than the 22 percent expected. The full-year operating margin also fell by 2 percentage points compared to the same time last year.

The FAANG (Facebook, Amazon, Apple, Netflix, Google) stocks were the primary drivers for the extended bull run in 2018. What’s in store for the FAANG stocks in 2019?

In the video below, Morris Mark, CEO and managing partner at Mark Asset Management, and Lori Calvasina, head of U.S. equity strategy at RBC Capital Markets, join “Squawk on the Street” to discuss Alphabet earnings and the broader markets.

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