1 Green Flag and 1 Red Flag for Alphabet
Economic downturns can be difficult for an advertising company like Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL). Many companies cut back on advertising spending during these times, as it is a manageable expense to control. Considering that 79% of Alphabet's revenue comes from advertising sources, these cuts create problems in Alphabet's financials.
However, Alphabet also has a bright spot: Google Cloud. In the third quarter, the segment proved businesses are still willing to build their cloud computing infrastructure, even if budgets tighten.
With Alphabet displaying both a red flag and a green one, which is more concerning to investors?
Source Fool.com