Ad sales rise can't save Google parent Alphabet from profit slump
Profits at Google's parent company Alphabet have fallen by 23 per cent in the face of rising costs.
Shares in the company dropped by 4 per cent in out-of-hours trading on news that profits had fallen by $1.7 billion during the third quarter.
Large investments in R&D and marketing hit the company's bottom line, including a big spend on new cloud computing technologies.
But the company's crucial ad sales business remained buoyant, rising to $33.92 billion from $28.95 billion in the same period last year.
Ad sales now account for as much as 85 per cent of Alphabet's total revenues.
In a statement, the company's chief financial officer Ruth Porat said: “As we’ve often discussed, we manage our business for the long term and not on a quarterly basis.
“We remain very focused on continuing to enhance the experience for users over the long term.”