Alphabet’s Google failed to reap the benefits of a strong economy that bolstered rivals in the first quarter, leaving the search giant’s revenue below Wall Street targets on Monday.

Shares of Alphabet dropped more than 5% after hours after closing up 1.5% at a record-high of $1,296.20.

Major competitors for ad spending such as Facebook, Snap, Amazon.com, and Twitter all reported last week quarterly revenue above or in line with analysts’ expectations.

Alphabet said its quarterly revenue rose 17% from a year ago to $36.3 billion, compared with Wall Street’s average estimate of $37.3 billion, according to IBES data from Refinitiv. Accounting for currency fluctuations, revenue rose 19%.

The 17% rise was the slowest in three years and compared with 26% for the same quarter a year earlier.

The company said paid clicks on its properties fell 9% compared with the previous quarter.

Quarterly costs rose about the same as revenue, up 16.5% from last year to $29.7 billion.

Expenses have surged faster than revenue for much of the past two years, concerning some investors amid increased scrutiny on the company’s privacy practices and efforts to restrict advertising on potentially offensive content.

But positive macroeconomic signals have given them reason to believe that the company’s ads business is healthy. Shares had risen 11.9% between its last earnings announcement and Monday.

About 84.5% of revenue, compared with 85.5% a year ago, came from Google’s ad business, which sells links, banners, and commercials across its own websites and apps and those of partners.

Google’s 3 billion users help make it the world’s largest seller of internet ads, capturing nearly a third of all revenue, according to research firm EMarketer. Facebook is at about 20%.

Alphabet’s capital expenditures fell 36% compared with last year to $4.6 billion. The growth moderated from last quarter as Alphabet had warned in February.

Alphabet has said its spending increases are justified, with huge outlays going to offices, datacenters, and artificial intelligence capabilities in line with the expected demand for its services.

Still, the company has yet to tout significant revenue from its spending on ventures such as self-driving cars and its AI helper Google Assistant.

Newer units that are producing noticeable revenue have lagged in market share, including Google’s consolidated hardware unit and Google Cloud, which sells computing and data storage services to businesses.

And Google’s costs could jump further if governments globally follow through on growing threats to rein in the ability of apps to track users for advertising purposes. Other regulators have discussed forcing companies to step up monitoring of user content.

Shares of Alphabet have gained 23% this year, the least growth among the so-called FAANG group, with Facebook at 48%, Netflix at 39%, Apple at 30%, and Amazon at 29%.

Fine accounting

Alphabet’s expenses included a $1.7 billion fine from the European Commission for having placed anticompetitive advertising restrictions on websites using its searches.

Income also was boosted by a change in valuation of Alphabet’s stake in ride-sharing app Lyft, which held an initial public offering a month ago. Alphabet could see similar gains later this year as other highly valued startups in which it has ownership, including transport app Uber and workplace software firm Slack, make their public debuts.

Including the European fine, net income was $6.7 billion, or $9.50 per share, compared with analysts’ average estimate of $7.3 billion, or $10.48 per share. Earnings excluding the fine were $8.3 billion, or $11.90 per share, beating analysts’ estimates of $10.61 per share for adjusted earnings.

Operating margin excluding the fine was 23%, up from 22% in the year-ago period.