net income was hurt by a record $5 billion antitrust fine imposed by the European Commission.
Alphabet continues to look up at Amazon Web Services and Microsoft Azure in the cloud market, although it did disclose earlier this year that combined revenue from Google Cloud and G Suite reached $1 billion a quarter.
Through the close of regular-session trading Monday, Alphabet shares had risen 15 per cent since the beginning of the year, while the Standard & Poor's 500 index has risen five per cent. The EU accused the company of abusing its dominant Android mobile-operating system to cement the popularity of Google apps and services.
Google CEO Sundar Pichai says the company would take a "constructive approach" to the European Union ruling that slapped the search giant with a multibillion dollar fine.
"Google reported a high-quality quarter in which the bulk of the top line outperformance vs. CS came from Websites (ongoing strength in mobile search, YouTube, as well as desktop search) followed by Network revenue (AdMob and programmatic)", the analyst Stephen Ju said. Google's advertising business grew 24 percent.
Alphabet said it would appeal the fine, but already accounted for the fine in its Q2 results.
"I'm confident we find a way to make sure Android is available at scale to users everywhere", Mr. Pichai said during the call with analysts.
Alphabet's $32.66 billion in second-quarter revenue, 86 percent of which came from Google's advertising business, beat an average estimate of $32.17 billion. Chief Financial Officer Ruth Porat suggested that the company would not sacrifice investment in its cash cow of advertising in favour of other bets like autonomous cars and delivery drones.
Macquarie Group senior analyst Benjamin Schachter wrote in a report this month that "we are approaching a point where we (and we believe The Street collectively) are not understanding the size of search vs YouTube vs programmatic, which may lead to increasing volatility" in share price.
Advertising is still the core business, and it's still strong.Alphabet recently moved its Loon balloon internet project and Wing autonomous drone initiatives under the Other Bets group, alongside Waymo, Fiber, Verily and cybersecurity outfit Chronicle.