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A few days back news broke that the European Union had fined Google a massive $5.04 Billion, that would end up making for a big hit on the company's earnings this quarter. Well, Google's parent company Alphabet Inc. (NASDAQ:GOOG)just posted its second quarter results and the impact did make quite a huge dent in the company's Net Income/share available to shareholders.

Wall Street had expected Alphabet's Revenue to stand at $25.6 Billion and Earnings Per Share at $9.64. Alphabet also continues to play its role as a major tech investor; a fact that's also reflected in its strong EPS gains (if we exclude the impact of EC's fine). So how well did Google's parent company perform this quarter? Let's take a detailed look.

Alphabet Inc (NASDAQ:GOOG)Reports $32.7 Billion In Revenue And $3.2 Billion In Net Income For Q2 2018 As EC Fine Impacts Net Income And Investment Gains Continue To Drive Up Earnings Per Share

Alphabet Inc, Google's parent company has had a fantastic quarter if we look at its revenue. Alphabet reported Revenue of $32.6 Billion this quarter, a sequential gain of $1.5 Billion. However, this was not translated into the company's GAAP Net Income due to the $5.04 Billion EC fine. Alphabet's Net Income for the quarter is $3.2 Billion, marking or a $6.2 Billion sequential decrease.

Net Income per share stands at $4.75, representing the full impact of this aforementioned fine. Without it, Alphabet Inc would have reported Net Income of $6.3 Billion, making for an approximate $3.1 Billion sequential decline. Considering trends over the past five years, Alphabet's revenue generally grows in the second quarter and this year's no different as the company earned $6.6 Billion more this quarter.

Q2 data.

Alphabet Inc (NASDAQ:GOOG)'s Traffic Acquisition Costs (TAC) Increase By 26% Year Over Year Reflecting Increasing Reliance On Mobile Traffic; Company Reports 58% Growth In Paid Clicks For Google, Cloud Computing And Other Bets Drive Up Capital Expenditure

Another metric for Google that performed below market expectations but grew over the year is the company's TAC (Traffic Acquisition Cost). TAC stands at $6.4 Billion growing by 26% yearly and by $132 million sequentially. However, Google's TAC-to-Advertising Revenue ration fell by 1%, indicating a slight improvement in efficiency. Google also reported a 58% growth in paid clicks but a 22% decrease in the amountpaid per click, reflecting an increase in low-revenue clicks.

Google's partnership with Target for cloud services and its other revenue sources such as Pixel smartphone and Chromebooks contributed to a strong growth in 'other revenue'. Alphabet Inc (NASDAQ:GOOG)'s Other Bets continues to make a minute portion of its overall revenue as it marked for only $145 million in cash generated with a $103 million yearly decrease. Finally, Google's increased emphasis on Cloud, Wymo, Fiber, and others is reflected in a 15.6% Capital Expenditure increase, with the Q2 value of $732 million.

Q2 data

Alphabet Inc (NASDAQ:GOOG)'s Investments Continue To Drive Up Net Income As Google's Parent Group Takes Complete Advantage Of New Accounting Standards; Investment Gains For The Year's First Half Exceed $4 Billion

Alphabet Inc. reported a $1.06 Billion gain on securities this quarter, as Alphabet continues to play a dominant role in tech investments. The group's investments sprawl across a wide number of industries, from human resources to biotechnology. Last quarter, Alphabet's stake in Uber reflected a $3 Billion gain from equity securities in its Other Income segment.

Finally, Alphabet and Google's executives also sounded optimistic about new European GDPR regulations, expecting them to become a source of increased dominance for Google. According to Sundar Pichai, Google intends to appeal the recent EC hearing. According to the EC, Google used its position with Android to ensure that its search engine had dominance across the market. According to Pichai, he is “looking forward to finding a solution, above all, that preserves the enormous benefits of Android users.”