The firm also pointed to a new Tax Act in the United States, which it says caused a one-time $9.9bn expense during the quarter. Income was estimated at $US300 million to $US1 billion against $US1 billion in the first quarter of 2017.
However, the Google parent company impressed on the revenue front, raking in $32.32 billion, marking a 24% climb compared to the year-ago quarter.
Google dominates the search-engine market, and therefore, search advertising, in part, because it's made itself the standard on web browsers and mobile phones around the world.
Alphabet increased their staffing levels with the headcount rising from 78,101 staff in Q3 2017 to 80,110 in Q4 2017.
Google thrives on clicks on its ads, which have grown steadily.
All told, Google's advertising revenue climbed almost 22% year over year to $27.2 billion. Paid clicks on Google websites jumped 48 from a year ago and 19 percent from previous quarter.
Alphabet missed Wall Street's expectations on earnings but beat the revenue expectation of $31.86 billion. (GOOG), there were 92 new positions totaling 2,441,052 shares of the company's stock.
The vast majority of Alphabet's revenue continues to come from Google and its various business, most notably its advertising network, but the company's so-called "other bets" saw revenues rise from $262m (£183m) past year to $409m (£286m) in the last quarter. Google dubs those payments traffic-acquisitions costs, and they're eating up a greater share of Google's revenue.
Investments are paying off, Pichai said, noting that cloud computing is generating US$1 billion in quarterly sales.
Owner of Google, Alphabet (NASDAQ: GOOG), performed less well in the three months coming up to Christmas. It reported $409 million revenue primarily generated by Nest, Verily, and Fiber, with operating loss up to $916 million from $812 million in the previous quarter. In today's earnings press release, the company announced that it would be John L. Hennessy, the former president of Stanford University who's been on Google's (and later Alphabet's) board since 2004. "Other revenues", a category that includes both Google's cloud business as well as its hardware revenue, grew to $4.69 billion, from $3.4 billion in Q4 of 2016.
The firm's expenses increased by 27 percent to $24.7 billion in 2017's fourth quarter compared to the same period a year earlier.