Google parent company Alphabet reported better-than-expected second quarter earnings on Thursday and finally provided an update on its cloud business. On a conference call with analysts, Google CEO Sundar Pichai said Google's cloud unit now has an annual revenue run rate of $8 billion, up from the $4 billion previously reported in 2018.
"Q2 was another strong quarter for Google Cloud, which reached an annual revenue run rate of over $8 billion and continues to grow at a significant pace," Pichai said. "Customers are choosing Google Cloud for a variety of reasons: reliability and uptime are critical. Retailers like Lowes are leveraging the cloud as one of the important tools to transform their customer experience and supply chain."
As for the numbers, Alphabet reported a net income of $9.95 billion, up from $3.2 billion a year ago, with non-GAAP earnings of $14.21 per share on revenue of $38.94 billion, when including traffic acquisition costs (TAC). Adjusted earnings were also $14.21 per share.
On average, Wall Street was looking for Q2 earnings of $11.33 per share with $38.17 billion in revenue.
The company's total TAC came to $7.24 billion. Net revenue excluding TAC was $31.7 billion. Traffic acquisition costs accounted for 22 percent of Google ad revenues.
Google revenues attributed most of Q2 sales with $27.335 billion in revenue. Google's Other revenues -- which include the company's enterprise cloud, software, and data management products -- were $6.18 billion. Revenue in Alphabet's "moonshot" Other Bets category, which includes Waymo, Fiber, Verily, and Alphabet's other healthcare-driven initiatives, ticked up slightly to $162 million with operating losses rising to $789 million.
Google's cost-per-click, which is how much it makes off each advertising click, decreased 11% year over year and 1% quarter over quarter. The company's total advertising revenue was $32.6 billion, up from $28.1 billion a year ago.
Meanwhile, the Mountain View-based tech giant said its board of directors approved an additional $25 billion share repurchase of its Class C capital stock. Shares of Alphabet were up around 7% in after hours trading.