Google-Parent Alphabet Got $8 Billion Unrealized Profit Boost Reportedly From Investment In Elon Musk's SpaceX

Search giant Google’s parent company, Alphabet Inc. GOOG, just reported its highest-ever quarterly earnings, bolstered by other income in the form of an unrealized gain tied to its investment in a private company.

What Happened: On Thursday, the search giant reported $34.5 billion in earnings during its first quarter, an increase of 46% year-over-year. This performance was aided by the company’s $11.2 billion in “Other Income,” which marks a 293% increase from the prior year, boosted by $8 billion in unrealized gains on its “non-marketable equity securities.”

Alphabet CFO, Anat Ashkenazi, addressed this during Thursday's earnings call but did not disclose the name of the company involved, consistent with the company’s long-standing practice of withholding specifics on private market investments.

See More: Alphabet Q1 Earnings Highlights: Google Search, YouTube, Cloud Show ‘Robust Momentum’

The private company in question has since been identified as SpaceX, according to a report by Bloomberg, which cited sources familiar with the matter. Alphabet, alongside Fidelity Investments, acquired a 10% stake in the aerospace firm for $1 billion in 2015.

Why It Matters: Alphabet’s earnings per share at $2.81 were well ahead of consensus estimates at 2.01 per share, and 49% over prior year figures at $1.89. This was largely due to this one-time gain of $8 billion.

In December 2024, SpaceX and its investors agreed to purchase insider shares totaling $1.25 billion, valuing the company at over $350 billion.

SpaceX dethroned Tesla Inc. TSLA as Elon Musk’s most valuable company last month, owing to it being better insulated from the fallout of Musk’s growing political involvement.

Price Action: Alphabet shares were up 2.38% on Thursday, and are up 4.63% in after-hours trading following the company’s first quarter earnings release.

Alphabet stock scores poorly in Benzinga’s Edge Stock Rankings, with an unfavorable price trend in the short, medium, and long terms. For more such insights, join Benzinga Edge.

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