Three pictures to understand Google's latest Q4 financial report: 1. The revenue and profit growth rates are steady, both exceeding expectations, with a strong EPS growth rate of 31%; 2. In our main business, search advertising exceeded expectations, youtube、 The subscription platform business is slightly lower than expected; 3. The most impressive feature is undoubtedly Google's cloud business, with revenue surging by 48% year-on-year to $17.7 billion, higher than analysts' expectations of $16.2 billion and accelerating growth from the 34% growth rate in the third quarter. The operating profit of cloud business in the fourth quarter reached 5.3 billion US dollars, 2.5 times the profit of 2.1 billion US dollars a year ago, far exceeding analysts' expectations of 3.7 billion US dollars. 4. And even more impressive is capital expenditure Google's capital expenditure in Q4 was $27.9 billion, nearly doubling from $14.3 billion in the same period last year, but slightly lower than market expectations of $28.2 billion. In 2025, capital expenditures will reach 92 billion US dollars, with fourth quarter expenditures accounting for 30% of it, exceeding the average quarterly expenditure level of 23 billion US dollars. Even more impactful is Google's 26 year spending guidance, which is expected to be between $175 billion and $185 billion, with a median of $180 billion, almost twice the amount expected in 2025. This is $60 billion higher than market expectations of $119.5 billion, and nearly 51% higher than expected. 5. How to read Google's financial report? 1) From the perspective of business data, it is naturally extremely excellent, and the most concerned business in the market has also grown by 48% year-on-year, far higher than Microsoft's cloud business growth rate. 2) What is the problem? Two points: Question 1: The year-on-year growth rate of EPS is 31%, and the dynamic P/E ratio is 29%, which is actually very close. Not overvalued, not cheap Problem 2: The growth rate of capital expenditure is too fast Capital expenditures are expected to increase by nearly 100% in the 26th year compared to the 25th year. Google's net profit of $130 billion and free cash flow of $73 billion over the entire 25 years, even with a 50% growth rate in 26 years, cannot cover the capital expenditures for the entire year. The huge capital expenditure has become a devouring beast, and it is difficult for the market not to panic. New gameplay on the US stock market, starting from Bitget: http://(bitget. com)/markets/stocks