Alphabet beat Wall Street expectations in second-quarter earnings, but couldn't save the company from its first revenue decline in history

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• Alphabet announced its second-quarter earnings for 2020, slightly beating Wall Street expectations.
• But it wasn't enough to save the company from its first-ever revenue decline, as the coronavirus crisis continues to pummel the advertising industry.
• Cloud was one of the brightest spots for Google, seeing a 43% year-on-year boost.
• Despite the dip, the company's stock remained steady after-hours.

Google's second-quarter results are in, revealing a slight beat on Wall Street expectations, though it wasn't enough to save the company from its first revenue decline since going public.

Parent company Alphabet reported revenue of $31.6 billion (minus traffic acquisition costs) with earnings per share of $10.13. That's down from the $31.7 billion reported in Q2 2019, but a smaller dip than Wall Street had predicted as the coronavirus crisis wreaks havoc on the advertising industry.

Though this is the first time that Google's revenues have ever shrunk year-over-year, the company did experience a sequential revenue decline in 2009 during the last major economic recession. Both then and now, the company's business suffered from shrinking advertising budgets.

One of the main offenders this time around was Google's core search and ad revenue, which was down 9.8% year over year. YouTube ad revenue growth decelerated as well, though it beat expectations with $3.81 billion in revenue for the quarter.

Despite the notable decline, the company's stock remained steady after its earnings call, in fact rising less than 1%.

Alphabet's chief financial officer Ruth Porat noted during the company's earnings call that she was "cautiously encouraged" by the fact that ad revenue growth improved near the end of the quarter, but acknowledged that the company wasn't "out of the woods" yet.

"We believe it is premature to gauge the durability of recent trends given the obvious uncertainty of the global macro environment," she said.

Meanwhile Cloud was an expected "bright spot" for Google. The unit, which includes its infrastructure products as well as its G Suite of productivity tools, raked in $3.01 billion in revenue – up from $2.7 billion for the same quarter last year and marking a 43.19% year-on-year boost. While hiring has slowed across the board for Alphabet, executives said on the company's call that it was still "hiring aggressively in priority areas like Cloud."

Google's "other" revenues, which covers things like hardware and Google Play purchases, were $5.12 billion for the quarter — up 25.6% year over year. Porat attributed the growth to a bump in app revenues as people were stuck at home because of the pandemic looking for entertainment.

As for Alphabet's "other bets" — it's longer term gambits such as self-driving car company Waymo and health tech unit Verily — the company reported revenue of $148 million, down year-over-year by about 8%. It's operating losses, meanwhile, swelled to $1.1 billion.

It was also announced that the Alphabet board has authorized the company to repurchase up to an additional $28 billion of its Class C stock.

While Google's numbers were a little better than feared, they come at a tense time for the company. Along with other tech giants Apple, Facebook, and Amazon, it had to testify before Congress on Wednesday in a hearing about antitrust concerns. Lawmakers grilled Pichai on how Google "stole" content, favored its own products, and whether it should spin out YouTube.

Here are the results compared to Bloomberg estimates.

Revenue: $31.6 billion (minus traffic acquisition costs) (Estimated $30.5 billion)

EPS (GAAP): $10.13 (Estimated $8.27)

Net income: $6.96 billion

Google Cloud revenue: $3.01 billion

YouTube ad revenue: $3.81 billion