Here's Why Alphabet's Fourth-Quarter Results Are So Important

Earnings season is a big deal for most U.S. companies, as investors use the reports to gauge a company's future success and determine whether the firm is a wise investment. While the earnings reports for most big name stocks are closely watched, next month's release of Google parent Alphabet Inc GOOG GOOGL's fourth-quarter earnings is set to be one of the most highly anticipated.,/p>

Not only has the tech giant been working on some ground-breaking projects over the past year, but the firm also made its operations much more transparent; its earnings release will finally give investors a clear picture of just how well the company is doing, according to the Wall Street Journal.

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Alphabet

Last year, Google changed its name to Alphabet and reorganized all of its businesses under that single parent company. The new structure did very little to affect the company as a whole, but for investors, it provided some much needed transparency.

Most are expecting to see the company's results broken down into specific operations so that traders can see where the firm's money is being spent and what kinds of results each business is achieving.

Advertising

One of this biggest factors to watch in Alphabet's earnings release will be advertising. In previous years, the profitability of the company's advertising arm has been lost among the company's other projects. With Alphabet's "moonshots" (experimental ventures like life science projects and drone delivery research) broken out as a separate business, the firm will allow investors to see how profitable Google's core businesses, like advertising, really are.

As this will be the first time investors are able to see the company in this light, many are placing bets as to whether Google's operating margins will impress or underwhelm investors.