Google sales

Alphabet Stock falls on Google Sales Miss in the worst day since 2012

Photography by Ore Huiying/Bloomberg


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Alphabet

The stock suffered a historic bad day in response to its earnings release, which ended with the stock’s biggest percentage drop since 2012.

The stock (ticker: GOOGL) closed down 7.5% on Tuesday, its biggest percentage drop since October 18, 2012, when its shares fell 8%. At the time, the company, which changed its name in 2015, was still known as Google.

Google was the worst performer of the


S&P500

index, which rose 0.1% on Tuesday.

Alphabet announced its surprisingly missed results on Monday evening. Adjusted earnings of $11.90 per share beat Wall Street’s forecast of $10.61. Revenue climbed year-over-year to $36.34 billion, but was below expectations of $37.3 billion. At 17%, year-over-year revenue recorded the slowest growth rate in several years.

Advertising, which generates the majority of revenue, was $30.72 billion, while analysts had expected $31.48 billion.

On Monday, Stifel analyst Scott Devitt downgraded his rating for Alphabet stock to Hold from Buy. He noted the company’s lower level of sales growth and explained how management admitted that YouTube’s click growth rate slowed in the quarter.

Other analysts cited the company’s lack of transparency when releasing results.

Google stock has risen in 11 of the last 21 quarterly earnings releases since March 2014. The biggest drop before today during this period was 5.4% in December 2016. By comparison, it gained 16 .3% after the publication of the results for the second quarter in 2015.