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Tech brief: Alphabet Announces First-Ever Dividend, Beats Q1 Revenue Expectations
+ 7 breaking tech news.
Kristoffer Lindström
April 26, 2024
TECH BRIEF
In a first, Alphabet, parent company of Google, announced a dividend of 20 cents/share, contributing to a near 13% surge in its shares after trading. The firm revealed that it also plans to repurchase up to $70 billion of its Class A and C shares. This comes as Alphabet reports first-quarter revenue beating estimates, mainly driven by rising cloud services demand amid a steady incline in advertising spending and growing adoption of AI. Notably, Google's cloud revenue grew by 28%, largely powered by AI tools.
Microsoft surpassed Q3 revenue forecasts with a 17% rise to $61.9 billion, propelled by AI adoption across its cloud services and business software products. The firm benefited from a surge in Azure cloud platform revenues, hitting $26.7 billion, and a notable 31% growth in Azure's revenue, reflecting the booming AI interest. The launch of AI-powered tool Copilot, combined with a PC sales recovery, also bolstered Microsoft's enterprise software and Windows sectors.
Meta's extensive AI spending has been challenged by investors who saw Meta shares slide after the company reported its higher-than-expected expenses on AI research. Despite Mark Zuckerberg's optimism, the company's AI deployments and the costs allied to them, expected to be around $5 billion more than the initial estimate, haven't convinced the market. The Facebook owner's image also suffered after its AI chatbot, BlenderBot, incurred severe criticism.
Elon Musk's AI firm, xAI, is close to raising $6 billion at a pre-money valuation of $18 billion, a substantial increase from initial proposed terms. xAI aims to integrate data across Musk's portfolio of companies, with social network X already utilising xAI's chatbot, Grok. This collective data is expected to be used in developing self-driving cars and Tesla's humanoid robot, Optimus.
Chinese tech firm ByteDance would rather shut down its popular social media app TikTok in the US than sell it if legislation banning it from US app stores is upheld. The decision mostly comes down to the app's algorithms, deemed core to ByteDance's operations, making a sale unlikely. Though the US accounts for 25% of TikTok's overall revenue, it only contributes a minor share to ByteDance's global turnover and daily active users.
Fintech giant Stripe is reentering the cryptocurrency market by letting customers accept payments in USDC stablecoins, operating on Solana, Ethereum, and Polygon. This marks Stripe's first acceptance of crypto since 2018, and follows its 2022 move of announcing payouts in USDC. Furthermore, Stripe is now allowing customers to integrate competing payment providers with its own financial services tools.
Meta has launched its AI-powered chatbot, Meta AI, across its social media platforms, including Facebook and Instagram. The assistant, dubbed by Meta as "the most intelligent", offers examples of text generation and image creation and is always available. Despite user backlash over privacy concerns and the inability to disable it, Meta contends the tool cannot access personal information unless explicitly shared.
Google has once again delayed its plan to eliminate third-party cookies from Chrome until 2025. Citing UK regulations, the global advertising giant suggests the postponement reflects challenges in balancing differing industry feedback. As rivals Mozilla and Apple eradicated this user-tracking feature earlier, Google intends to first implement an alternative advertising feature—Topics API and "Privacy Sandbox"—to maintain user interest tracking.
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