Alphabet’s market value reaches $ 1 trillion for the first time.

Alphabet’s market value reaches $ 1 trillion for the first time.

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The capitalization of Alphabet, which owns Google, for the first time reached $ 1 trillion. Prior to this, only three IT companies managed to achieve this market value: Apple, Microsoft and Amazon.

The market value of Alphabet, the parent company of the search engine Google, for the first time reached $ 1 trillion. At the time of publication, the company’s shares on the Nasdaq exchange went up 0.76% and cost $ 1,450.16.

Since the beginning of the year, Alphabet shares have added more than 7%, and since June 2019 – 40%: investors’ hopes have positively affected that the company will report on February 3 about the next record figures in the advertising segment, Financial Times and Bloomberg explained. Alphabet is expected to report sales growth of almost 20%, to a total of over $ 160 billion. As FT noted, Google has managed to present itself as the main beneficiary of the fact that the global advertising and marketing market has largely concentrated on the Internet.Advertising is a significant revenue source for Google, and the search engine, in turn, brings 99.6% of Alphabet’s revenue. The mobile advertising segment is growing, which in 2018 overtook advertising on the PC. YouTube turned out to be a successful acquisition at one time, noted Mark Mahani, an analyst with RBC Capital Markets. U.S. presidential elections will be held in 2020, and the cost of political advertising will also bring Google significant revenue, quoted KeyBanc Capital Markets, a consulting firm, Bloomberg.

In addition to advertising, good results are also shown by the Play store, cloud services and gadget sales, which bring 16% of Alphabet’s revenue. The company is getting more expensive, despite growing calls to tighten privacy and antitrust investigations by US authorities, FT added.

Alphabet reached a historic mark a month and a little after Google’s founders Sergey Brin and Larry Page announced their resignation from senior positions at the company. They continue to participate in the work of the IT giant as co-founders, major shareholders and members of the board of directors, but the operational management has passed to the former head of Google Sundar Pichai. Only in the first two days after the announcement of the departure of the founders, Alphabet shares gained 2%, and Page and Brin’s capital grew by $ 1 billion each. Wall Street hoped that Alphabet, under the leadership of Pichai, would be more judicious in spending money, FT said.

The first public company to achieve a capitalization of $ 1 trillion was Apple in August 2018. Since then, the company’s value has added more than a third of a billion. Then, Microsoft reached the historical mark (now it costs $ 1.26 trillion) and Amazon. The company of the richest businessman in the world, according to Forbes, Jeff Bezos, however, did not stay in the “big league” for long: now it costs about $ 933.7 billion. All these companies were bypassed by the Saudi state oil company Saudi Aramco in December: immediately after the IPO an expensive company in the world ($ 1.7 trillion), and on the second day it surpassed the mark of $ 2 trillion.

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