take a listen to ruth porat, the c.f.o. the investor call. >> in terms of the revenue detail, google site revenues were $18.4 billion in the quarter. up 20% year over year. youtube. the biggest growth was in mobile search and youtube. emily: joining me, the bloomberg senior analyst. we are taking a look at shares after hours. you can see the spike, then the plunge. what is going on? >> if you look at the underlying demand through paid click change , strongest growth since 2007, the demand is strong. the traffic acquisition costs, because they are making more money from mobile and programmatic advertising, the acquisition cost is higher on those platforms. that is why the net revenue came in line with estimates or missed most of the bullish estimates. that is why you saw the reaction you see. emily: we have been talking about what has been going on with other bats becoming a smaller piece of the pie overall. this is what ruth porat was brought in to do. losses are narrowing. revenue is increasing. they have taken a pause on

ruth porat says we will make the business simpler to understand.have alphabet as a parent company. google is the biggest business, here is how it works. they have made google more complicated from a marketer's perspective. there are more places the ads are going on in terms of mobile and programmatic. they have emphasized big growth in you time which -- youtube which is highly under monetized. they have numbers on youtube unbelievable. 1.4 billion users on youtube, registered users logged in. this is not just people watching on a twitter feed or catching a video. emily: second only to facebook. --those are cory: those are huge numbers. i think they have made the business more interesting and complicated with the number of ads and type of ads they sell even though the overall business looks simpler by description. emily: when it comes to other the lossestold me are coming down in part because of a pause when it comes to google fiber. the increasing simplicity of the overall business, does it make you more or less excited about the stock as a whole?

cfo ruth porat talked about that impact take a listen. >> operating expenses including the impact offine were $11.5 billion. excluding the impact at the ec fine, operating expenses were $8.l billion in the quarter, up 18% year over year operating income was $4.1 billion. excluding the impact of the ec fine, operating income was $6.9 billion, up 15% versus last year in the operating margin was 26%. >> now, i did have the opportunity to speak briefly with ruth porat, asked her how the company is going to respond exactly and this other worry about whether regulators have an impact on other products down the line the kind of snowball effect here she was not willing to go there with me, simply saying it's an ongoing legal matter one other points analysts are bringing up rising traffic acquisition costs. porat says it will increase, or focus, she said, on growing profit dollars we're pleased to have a strong position in a growing area melissa, back to you. >> josh, thank you, josh lipton in san francisco gene munster of loup is standing by with his analysis so, gene, what are the highlight

. >>> welcome back we're waiting on comments from alphabet cfo ruth porat after the company's latest coming up. alphabet shares are under some pressure after these results can can the conference call turn things around? we're going to ask a member of morningstar and ed lee from recode and james wong ark invest welcome to all of us james, you're here, i'm sorry, so we'll begin with you. what do you think the stocks selling off at the quarter what jumps out to you? >> results look pretty good. it's a beat there and on the bottom line it's pretty clean. i think, you know, at times like this, i heard the earlier commentators say they are cautious about their positioning. it's important to kind of remind people, portfolio managers or analysts, why they only stock in the first place. google is a company that's had a long evolution since its ipo in '04. first a search company and then it became a mobile and cloud company and actually something that's not well understood or perhaps not well believed is that the company is going through a third evolution which is becoming an ai company. we th