Google parent Alphabet said Thursday its third-quarter profit rose 36 percent to $9.2 billion, fueled by gains in digital advertising delivered online and on smartphones.

Profits were better than expected for the US technology giant, while revenues fell short of forecasts, rising 21 percent to $33.7 billion in the three months ending in September, compared with the same period a year earlier.

The mixed results come with Google under scrutiny along with other tech firms for its privacy and data protection policies, and new revelations on the company's handling of sex harassment claims.

"Our business continues to have strong momentum globally, led by mobile search and our many products that help billions of people every day," said chief financial officer Ruth Porat.

In after-hours trade following the report, Alphabet shares slid 4.8 percent on apparent disappointment with revenue growth.

"Alphabet is the ad revenue king, so any softness makes people nervous," said independent technology analyst Rob Enderle.

The vast majority of revenue for Alphabet came from Google and more than $28 billion came from digital advertising, where it leads the market.

But even though it dominates online advertising, Alphabet and Google have been working to become more diversified, with its own Pixel brand of smartphones and tablets, its Google Home smart speakers which are gaining ground on market leader Amazon, and services like cloud computing.

- Hardware 'momentum' -

"Our hardware efforts are picking up real momentum," Google chief executive Sundar Pichai told analysts on a conference call.

Alphabet's "other bets," which include divisions on self-driving cars, internet balloon, drone, life sciences and cybersecurity, rose to $146 million from $117 million a year earlier.

But the "other bets," which are not itemized in Alphabet's earnings, widened operating losses to $727 million from $650 million last year.

The earnings report comes with Google faces increasing scrutiny from regulators in the US and Europe over privacy and data protection and the shutdown of its Google+ social network following a security flaw that exposed user data.

The company faced a fresh controversy Thursday after a New York Times report said Google covered up claims of sexual harassment and paid one senior executive $90 million to leave as he was accused of misconduct.

Pichai said in a statement the report was "difficult to read," but did not address specific allegations, noting instead that the company had taken an increasingly hard line on misconduct in the past two years.

The CEO said in an email to employees 48 people had been terminated for sexual harassment in the past two years, including 13 who were senior managers and above and that none received "an exit package."

"In recent years, we've made a number of changes, including taking an increasingly hard line on inappropriate conduct by people in positions of authority," Pichai said.

"We are dead serious about making sure we provide a safe and inclusive workplace," he said. "We want to assure you that we review every single complaint about sexual harassment or inappropriate conduct. We investigate and we take action."

Twitter surges on profit, revenue growth
Washington (AFP) Oct 25, 2018 - Twitter shares flew higher Thursday after the social network reported a record quarterly profit that helped investors look past a drop in the number of users due to the weeding out of fake and abusive accounts.

The San Francisco group delivered a $789 million profit, including one-time gains, compared to a net loss of $21 million in the previous year, as revenues grew 29 percent to $758 million.

Shares soared 15.5 percent to close at $31.80 following the better-than-expected results, which helped investors overlook a drop in Twitter's user base.

Average monthly active users totaled 326 million, down from 335 million in the previous quarter. The company said the drop came from efforts to weed out fake and inauthentic accounts. Recently enacted privacy rules in the European Union also had an effect.

The record profit represented a fourth consecutive positive quarter for Twitter after years of losses, and included one-time gains from tax adjustments. Excluding those items, profits amounted to $163 million.

Twitter said the drop in its user count was a direct result of efforts to improve the "health" of its platform by removing fake and abusive accounts.

"We're achieving meaningful progress in our efforts to make Twitter a healthier and valuable everyday service," said chief executive Jack Dorsey in a statement.

"We're doing a better job detecting and removing spammy and suspicious accounts at sign-up... This quarter's strong results prove we can prioritize the long-term health of Twitter while growing the number of people who participate in public conversation."

Brian Wieser at Pivotal Research Group called the results "very strong" and said Twitter appears on track to continue making profits.

"Efforts by the company to eliminate inauthentic accounts -- even large numbers of them -- and improve the health of the platform should be viewed positively because these efforts improve Twitter's position with regulators and with advertisers, who see the user base as higher quality when purges occur," Wieser said in a research note.

Richard Greenfield of BTIG Research said in a tweet that Twitter's data suggests its daily active users "are 33 percent higher today than in Q3 2015."

- Health vs. growth -

Twitter and other social networks have faced challenges in curbing manipulation and weeding out "hate speech," but Dorsey said the removal of abusive content will be beneficial for the platform in the long term.

"We do see health as a growth vector over the long term," Dorsey told analysts on a conference call.

"Our purpose is to serve the public conversation. And we have a singular objective within that purpose, which is around increasing health of the public conversation."

Dorsey cited "some new techniques" that have helped curb the creation of inauthentic accounts, thereby reducing "abuse, misinformation, echo chambers and manipulation."

Twitter has managed to swing into profit over the past few quarters after years of losses, but it has struggled to grow its user base beyond a core of celebrities, journalists and political figures.

It has sought to expand its appeal with new services, including live video.

Twitter claims its estimate of daily users, which it says reflects engagement, was up nine percent in the past quarter but offers no specific numbers.

Advertising, which makes up the bulk of Twitter revenues, grew 29 percent over the past year to $650 million, according to the earnings report.

Twitter said it had 67 million monthly active users in the US in the quarter, and 259 million internationally.

Despite its unique offering of near real-time information, Twitter has lagged behind other social networks such as Facebook and Facebook-owned Instagram.

According to the research firm eMarketer, Twitter's share of worldwide social network users is expected to drop slightly from 10 percent in 2018 to nine percent in 2022.

In 2018, Twitter will take a 1.8 percent share of display ad revenue worldwide, according to eMarketer.

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