Google is seeing decelerating growth after consistently expanding at 20% or more in prior periods. Revenue increased 17%, down from growth of 28% a year earlier, and ad sales rose 15%, down from 24% a year ago.

In premarket trading Tuesday, Alphabet's stock was down more than 7%.

Alphabet shares sank on Monday after Google's parent company reported revenue that fell below analyst estimates for its first-quarter 2019. The drop wiped more than $60 billion off Alphabet's market cap.

Paid clicks on Google properties grew only 39% from the year-ago quarter. That's a sharp drop from the fourth quarter or 2018 (up 66%) and third quarter (up 62%). It means that Google properties are not growing traffic volumes as quickly to make up for declines in advertising prices.

Ruth Porat, Alphabet's finance chief, said on the earnings call with analysts that most of the deceleration is related to YouTube, which "represents the vast majority of total clicks."

Porat said, "While YouTube clicks continue[d] to grow at a substantial pace in the first quarter, the rate of YouTube click growth decelerated versus what was a strong Q1 last year reflecting changes we made in early 2018, which we believe are overall additive to the user and advertiser experience."

Investors had high hopes coming into the report with the stock surging 24% for the year and closing at a record on Monday. The stock has joined a broader rally across the tech industry.

Traffic acquisition costs (TAC) in the period were $6.86 billion, while analysts expected $7.26 billion. This metric represents the payments Google pays to companies like Apple to be the default search engine on their browser.

Alphabet recorded a European Commission fine of $1.7 billion in the quarter as a settlement for stifling competition in the online ad sector. Excluding the fine, the company's operating income rose 26% to $8.31 billion. Total cash and marketable securities rose 4% to $113.5 billion.

Google has pinned much of its future growth on the emerging areas of its business as cost per clicks (CPC) decline. The company's hardware and cloud businesses are included in Google's "other revenues" segment, which saw a 25% increase to $5.45 billion.