Alphabet (GOOG, Financial) was the top contributor for the fiscal year in the Oakmark Global Select Fund 2023 Q3 letter. The company reported strong earnings, consistently exceeding consensus estimates. Notably, search revenue growth accelerated from 5% to 6.5% sequentially in the second quarter, despite economic uncertainties and advertising market challenges. Cloud growth remained stable at 30%, with margins improving to 5%. CFO Ruth Porat highlighted that the most significant impacts of cost-saving initiatives will be realized in 2024. YouTube's Shorts segment is experiencing strong viewership growth, although it presents a near-term revenue headwind. CEO Sundar Pichai emphasized Alphabet's positioning as an "AI-first company," showcasing new AI-powered consumer tools at the annual developer conference.
"Overall, we believe the company is positioned well to reap the benefits of the scale of its search business and years of its investment into AI capabilities. We also appreciate that the company is undergoing a transformation on how it views cost discipline and efficiency." — Oakmark Global Select Fund, Q3 2023 Fund Letter
Read full letter at gurufocus Oakmark Global Select Fund 2023 Q3 page.
