Capital expenditures of Google tripled

Google Review

During the first quarter of the year 2018, Google’s capital expenditures has tripled from the same period the previous year, surpassing analysts estimates.

Alphabet, Google parent company, exceeded Wall Street forecast during its earnings report on Monday. Gaining a revenue of $31.15 billion in comparison with the $30.29 billion that was predicted.

It is clearly that the search engine powerhouse is spending money in order to make money. For the first quarter of the year 2018, the capital expenditures for Alphabet’s Google division was valued at $7.669 billion.

This figure is triple from the same period last year, when Google posted only a total of $2.409 billion in capital expenditures. During the last quarter of the year 2017, Google spent $3.805 billion.

This sudden surge clearly indicates the company’s dedication to grow further by spending, as stated by CFO Ruth Porat during the earnings call. Most analysts had predicted a $3.5 billion in capital expenditures for all of Alphabet’s sectors.

Porat added that data centers and other related facilities were the major driver of costs. Google also concluded the $2.4 billion purchase of New York’s Chelsea Market the previous month.

As stated by Ruth Porat, facilities that were spent in Google, which are mainly dominated by the Chelsea Market, indicates that the company is in favor of expanding rather than leasing real estate in the appearance of a great opportunities. The company is also focusing on the growth of data centers and the increased network connectivity by means of undersea cables.


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