Alphabet Inc (Google) Class A

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Alphabet Inc (Google) Class A NASDAQ
 
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History of GOOGL

Important events

May 122022

Google gives us new gear

Lots of new gadgets are coming to Google, including its eagerly-anticipated Pixel Watch.

  • The Pixel Watch will drop in the fall as a “premium product”. It will be compatible only with Android devices, but will be able to function away from its host smartphone. Google plans to run it on the company’s Wear operating system alongside Fitbit’s health tracking software (it acquired the company in 2019).
  • Google will also be releasing the new Pixel 7 smartphone, also set to launch in the fall. Apart from these two big launches, Google announced new Pixel Buds Pro earbuds, as well as a planned 2023 return to making tablets. Watch out Apple, Google wants your iPad and watch sales.
  • The new gizmos and gadgets will help Google’s hardware push. While it still generates most of its revenue from advertising, Google generated over $8bn in hardware and app sales in Q1 of 2022 – a markup from $6.6bn from the same quarter in 2021. Better late than never, we guess.

Say hello to Google Pixel Watch, the first watch made inside and out by Google. Built on Wear OS, it features the best of Google, plus Fitbit health and fitness experiences — all on your wrist. Coming this fall

Apr 272022

Alphabet earnings go down the (You)Tube

Is YouTube canceled? Tech behemoth Alphabet gets dragged down into the dumps by declining ad revenue on its fave video platform.

  • Shares sank nearly 10% in extended trading on Tuesday after hitting a near nine-month low in day trading. It came after the company’s Q1 missed on both ends, reporting EPS of $24.62 on revenues of $68.01bn – that represents 23% growth YoY, a slowdown from 34% in the same period last year.
  • What went wrong? In a nutshell, YouTube. Ad revenue on the platform came in at $6.87bn, showing growth of 14% but still lower than the $7.51bn expected. CEO Sundar Pichai says it’s not their fault though – apparently YT’s 2bn users still spent time on there, but the war in Ukraine meant the larger European region has decreased their ad spend.
  • And apparently the tough times aren’t over. Alphabet CFO Ruth Porat said this quarter will be even more challenging bc of foreign exchange headwinds and its shutdown of operations in Russia. It can’t have inspired big tech investors, who already sent the tech-heavy Nasdaq plummeting to 2022 lows on Tuesday in anticipation of this week's earnings.
See all reported financials
Javier Miranda / Unsplash
Apr 142022

Google’s going green

Big tech seems to finally be recognizing how massive its environmental footprint is, and is starting to ramp up its eco-friendliness.

  • Google’s global data centers use double the electricity of San Francisco a year, which let’s be honest is kinda nuts, and that number is only going up as the world switches to the digital side of life. But, the brand has a plan.
  • Its global data centers will use 100% carbon-free energy by 2030, a goal that CEO Sundar Pichai has said stresses him out but is “humanity’s next moonshot”. Google has claimed to be completely carbon-neutral since 2007, but it’s ready to up its game to use 100% clean energy.
  • Alphabet’s baby isn’t the only tech firm making changes. Online payments firm Stripe has teamed up with Alphabet, Meta, and several other tech firms, to commit nearly $1bn to turbocharge the carbon-capture market – which basically means capturing carbon emissions and storing them underground so they don't enter the atmosphere.
dan carlson / Unsplash
Mar 312022

Alphabet’s robotaxi dreams become Waymo realistic

San Fran is becoming the home of the robotaxi revolution thanks to Waymo’s (Google’s self drive unit) latest milestone, while Pres Biden pumps funds into the EV sphere.

🔍 Key points:

  • Waymo’s completely self-driving taxis are ready to hit the roads of San Francisco without any safety drivers, after years of development and testing.
  • The company is one of many trying to build and deploy a commercial autonomous driving service, like Argo AI and Cruise. One company not near the finish line is Tesla, despite Elon Musk claiming he’d have over a million robotaxis on the road by 2020.
  • EVs in general are about to get a Biden boost. The president plans to invoke Cold War-era powers to encourage domestic production of materials needed for EVs (which are in low supply atm) as a way to reduce dependence on international energy supplies.
Waymo
Mar 232022

Google’s Sandbox AQ finds its own playground

Google parent company Alphabet is waving goodbye to its quantum computing baby as the brand goes to play in the big kids’ playground.

🔍 Key points:

  • Alphabet has spun off software start-up Sandbox AQ into an independent company after letting it quietly grow since 2016, skimming under the radar because it operates outside of Alphabet’s popular “moonshot” division.
  • It’s turned into a brand that boasts a number of high profile clients and big developments in the quantum technology and AI spaces, already getting over nine-figures in funding from big investors like the CEOs of both Google and Salesforce.
  • Apparently, there’s crazy demand for quantum tech rn because it has the potential to be faster than a supercomputer. Research firm Gartner estimates that by next year 20% of global companies will budget for quantum-computing projects, up from under 1% in 2018. Other big tech companies like Microsoft are also investing in the industry.
Duangphorn Wiriya / Unsplash
Mar 092022

Google gets Mandiant defense robot

Google defies the cries of regulators to boost its cyber defenses and keep hackers at bay.

🔍 Key points:

  • Google has spent $5.4bn on buying cybersecurity company Mandiant, marking parent company Alphabet’s second biggest acquisition ever. Mandiant used to be under the FireEye umbrella, which was the brand credited with helping uncover the SolarWinds attack last year.
  • The internet search giant is trying to keep up with the scale of rivals like Microsoft Azure (which was also in talks to buy Mandiant) and Amazon Web Services, according to its CFO. As instances of cyberattacks on cloud platforms and government services escalate, Google is also trying to go the extra mile to keep customers safe.
  • Mandiant, for one, was thrilled with the purchase and soared 16% on the news; Google investors still seemed pleased but were less emphatic about it, sending the stock up 4% before closing up 0.57% to snap a five-day losing streak. Now let’s see how hard line antitrust regulators will be with the news…
Markus Spiske / Unsplash
Feb 172022

Google takes a bite out of Apple’s book

Google announces tracking changes that are similar to Apple’s in an effort to make Androids more private.

Key points:
  • Google plans to introduce new privacy restrictions on its Android devices that will put an end to tracking across apps on the phones, giving developers two years to adapt before enforcing the new rules – which Apple didn't.
  • Part of the motivation is to get ahead of regulatory issues that have been plaguing big tech as lawmakers get increasingly concerned about consumers' personal data and how it’s used.
  • Apple’s privacy changes have made a massive dent in targeted advertising, as is clear from this earnings season, as social platforms posted significant drops in advertising revenue – Meta (FB) alone said it would lose $10bn this year from the changes, so with Androids switching over too, big tech is going to have to make some big adjustments.
Denny Müller / Unsplash
Feb 022022

Double dollar bills

Alphabet is the one to beat after kicking off this week’s big tech earnings by nearly doubling its profit.

  • Prices bounded up 8% in morning trading on Wednesday to surpass $3,000 after easily beating on both ends with EPS of $30.69 on revenues that were up 32% to $75.33bn, proving once again that it can withstand regulatory and economic pressures.
  • Annual revenue nearly doubled to top $200bn for the first time, largely on the back of its advertising strength – ad revenue was up 33% to $61.24bn, with core search revenue stealing the show.
  • It announced a 20-for-1 stock split as it tries to make its shares more available to the masses – it’s only the second stock split it’s had since going public in 2004, and follows in the footsteps of other tech giants who took similar steps in the pandemic.
See all reported financials
Sharon McCutcheon / Unsplash
Jan 312022

Waymo wants its windows tinted

Alphabet’s self-driving car unit, Waymo, is fighting to keep its data private in case the increasingly hot competition steals its tactics.

  • Waymo filed a lawsuit against the DMV to try and keep details of its recent self-driving accidents out of the public eye – its 24 incidents make up most of the autonomous driving crashes in California last year.
  • It says its safety protocols are a trade secret, arguing that competitors like GM (GM) or Ford (F) could steal its tech and give Waymo a disadvantage in an increasingly competitive market.
  • Only a few completely autonomous services are approved atm, so how this plays out could hint at the regulatory mood for others that want to follow suit.
Waymo
Jan 212022

Google climbs aboard the crypto train

Google finally joins the social media giants of the world with its first public blockchain project.

  • Google is creating a dedicated blockchain team under a newly appointed exec to spearhead its move into crypto and its underlying technology.
  • It’s Google’s first major public crypto project – up until now it’s only really offered cloud services to blockchain-related companies and let its payments unit dabble behind the scenes.
  • It’s about time it joined the cool kids. Other social media platforms like Twitter (TWTR) and Meta (FB) have devoted massive resources to getting their platforms ahead of the Web3 game.
Illustration by TradingView
Jan 052022

A Siemple security acquisition

Google is protecting its Cloud customers from the growing threat of cyber attacks with its latest purchase.

  • It’s spending around $500m on Israeli cybersecurity firm Siemplify, marking the tech giant's first international cybersecurity purchase.
  • It’ll be integrated into Google Cloud’s Chronicle operation, which was created specifically to help Cloud customers spot and combat cyber attacks.
  • It’s all part of its pledge to President Biden to spend $10bn on cyber strength in the next five years as cybersecurity threats get worse (Colonial Pipeline, we’re looking at you).
Illustration by TradingView
Dec 302021

Waymo wades into Robotaxis

The robotaxi race is heating up, and Alphabet’s Waymo refuses to eat dust.

  • Waymo is partnering with Volvo owner Geely (0175) to bring a fleet of all-electric, self-driving robotaxis to the U.S.
  • Its robotaxi service has had huge success so far in Phoenix and San Francisco, where it runs the country’s first and only driverless taxi service, which boasts a packed waiting list.
  • It left out the fact that Geely is a China-based company at a time when U.S. policymakers are coming down hard on U.S. investments in Chinese companies.
Waymo
Nov 162021

Good day mate

Google and Australia are chucking a shrimp on the barbie and making amends after Google brought a cheque big enough that they had to let them in.

  • Google is investing $740m into Australia to build a research hub, its biggest ever investment into the country and a pretty good apology gift if you ask us.
  • Google threatened to shut down operations down under after a new law said it had to pay news publishers for content earlier this year, so there’s been a swift change of heart.
Nov 152021

Regulators are circling

Google’s legal team is going to have a busy 2022 after yet another lawsuit lands on their desk.

  • A group of U.S. states have filed a new complaint against Google, accusing the tech giant of abusive and monopolistic practices.
  • Google just lost an antitrust fight against the EU and will have to shell out $2.8 billion in fines, which doesn’t bode well for future lawsuits.
Nov 102021

Google hits the sweet spot for a swift second

Parent firm Alphabet flirted with a new milestone this week, giving it a little kiss on Monday.

  • Alphabet popped past $2trn for the first time on Monday, building on momentum from its impressive earnings last month.
  • Q2 was fuelled by a rebound in digital ads and cloud growth, and prices are up 7% since the release on October 26.
  • Google only hit $1trn in January last year. If it hits a stable $2trn soon it’ll be the fastest company ever to have made that leap.
Oct 272021

Google sails ahead to beat earnings expectations

Snap (SNAP) got big tech investors worried last week after the social media giant warned just how much Apple’s recent privacy changes have taken a toll on advertising revenues across the board, but Google managed to buck the trend to report strong numbers. Alphabet beat on both the top and bottom lines, reporting earnings per share of $27.99 on revenue of $65.12 billion (its highest revenue in 14 years), exceeding expectations of $23.48 in earnings per share on revenue of $63.34 billion. Its cloud unit was part of the reason revenue came in so high, having seen a 45% jump to $4.99 billion thanks to heavy investment in the segment as it tries to keep up with Amazon (AMZN) and Microsoft (MSFT). CEO Sundar Pichai said:

This quarter’s results show how our investments there are enabling us to build more helpful products for people and our partners. Ongoing improvements to Search, and the new Pixel 6, are great examples. And as the digital transformation and shift to hybrid work continue, our Cloud services are helping organizations collaborate and stay secure.

Clearly their actions have seen some positive return, and Scott Kessler, an analyst with Third Bridge, said:

What Google has been doing, in terms of focusing on and offering products around analytics and (artificial intelligence) and (machine learning), that was really a differentiator for them.


All eyes were Google’s advertising revenue after Apple changed the way that social media platforms could use data to target consumers a few months ago, which the company seems to have overcome to boast a 43% jump in ad revenue to $53.13 billion – $7.21 billion of which was thanks to YouTube advertising revenue. Facebook’s (FB) earnings on Monday also cited the changes, but Google’s advantage is that it owns the Android operating system, which gives it a treasure chest of personal data on a bunch of people and leaves it less reliant on Apple.

Alphabet lifted in Tuesday after-hours trading.
Illustration by TradingView
Oct 222021

Big changes for big tech

Big tech is going through some big changes – not long after Apple changed up its app store payments policies, Google has followed suit and slashed its service fees.

After being on the receiving end of global scrutiny for months, big tech is having to change the way it charges app developers on their online stores. Apple has cut its fees from 30% to 15%, and now Google is feeling the pressure and following its lead. Google is reducing the percentage it takes from subscriptions that are derived from its Android App store by half, down to 15% for a set list of store categories.

It’s great news for developers, who will now be able to save a tonne on costs, but poses an obstacle to Google, which last year brought in $11.6 billion in in-app purchases from the estimated $38.8 billion that was spent in the Google Play Store. The tech giant already announced earlier this year it wouldn't take any service fee off the first $1 million in sales made by app developers, and in July the company was hit with an antitrust lawsuit by the state over anticompetitive practices in its Android Store – so it was feeling the regulatory heat.

Companies included in the broader categories rejoiced on the news, with dating conglomerate Match Group (MTCH) lifting over 10%, Bumble (BMBL) popped 16% before closing the day up by 8%, and language platform Duolingo (DUOL) jumped 12% while its CEO took to Twitter to celebrate.

This is great news! This reduction in subscription fees will help Duolingo accelerate our mission of providing universally available education.

Oct 202021

Pixel 6 is here

Google wraps up its Pixel 6 Fall Event, unveiling two new phones and a bunch of new features made possible by its Tensor processor.

Google is stepping up its phone game, giving fans two new Pixel 6 phones that are based on its brand new Tensor processing chip, which is made to show off the tech giant’s new machine learning capabilities as it competes with rivals like Microsoft.
Trusted Reviews
Oct 082021

Google invests $1 billion in Africa

Google invests $1 billion into start-ups in Africa, a commitment that includes a new subsea internet cable.

Google is increasing its investment into Africa, injecting $1 billion into an Africa Investment Fund, which aims to give start-ups access to the internet. Part of the fund will also be allocated to low-interest business loans for small companies in certain African countries. Google CEO Sundar Pichai said:

Increasingly, we are seeing innovation begin in Africa, and then spread throughout the world. For example, people in Africa were among the first to access the internet through a phone rather than a computer, and mobile money was ubiquitous in Kenya before it was adopted by the world. This momentum will only increase as 300 million people come online in Africa over the next five years.
Oct 062021

Google’s AI investment is paying off

Google’s huge investment into artificial intelligence (AI) is starting to pay off, and its AI unit DeepMind turned its first ever profit last year.

Google first acquired U.K. artificial intelligence start-up DeepMind in 2014 as a way to compete with the growing list of tech companies that had begun investigating deep learning – and its purchase is starting to pay off. After losing around £500 million in 2019, DeepMind made its first ever profit last year – revenues have tripled from last year to £826 million.
Oct 042021

Is Google dropping out of the fintech race?

Looks like tech giant Google is retreating from its efforts to make a name for itself as a dominant player in the financial services space, cancelling its plans to offer bank accounts to its customers. Google first revealed its ambition in 2019: claiming that its digital wallet, Google Pay, would allow customers to open a checking account through the app in partnership with financial institutions CitiGroup and Mastercard sometime in 2021. However, it looks like the tech giant is going a different direction now, potentially to make space for its burgeoning Cloud unit, and has abandoned its plans. The move comes not long after one of Google Pay’s key executives left the company, stirring up rumors of missed deadlines and delays in the project. Google said:

Our work with our partners has made it extremely clear that there’s consumer demand for simple, seamless and secure digital payments for online and in-store transactions. We’re updating our approach to focus primarily on delivering digital enablement for banks and other financial services providers rather than us serving as the provider of these services.

Big tech across the board has been invading the consumer finance space for a while now. Amazon (AMZN) has already added lending, payments, and insurance features to its services among others, and has suggested plans to offer a checking account (though nothing has materialized on that front yet). Apple (AAPL) launched a credit card in 2019; while Facebook previously (FB) tried its hand in the world of fintech with its (also cancelled) Libra currency.

While Google is scaling back its banking efforts, it's concurrently ramping up its Cloud-based effort to challenge Amazon (AMZN) in the blockchain/developer space. Google is making sure that it will be a leader in the next generation of the world wide web and joined forces with Dapper Labs earlier this month to power a blockchain-based web service. Google’s cloud unit also just expanded its collaboration with chip maker AMD (AMD) to ensure faster application performance on the platform.
Mitchell Luo
Sep 222021

Big tech might be about to get some big new rules

Russia has been cracking down on Google and Facebook as a way to limit access to information online, and big tech might now face amends of 5% to 20% of their revenue.

Big Tech has gotten itself in the bad books with Russian internet regulators after refusing to delete content deemed “illegal” by the government. As political unrest in Russia rises, so the government is working hard to take power away from social media platforms that help people organize, and a government statement says:

For a number of companies that have systematically refused to comply with the agency’s legal demands, the issue of fines on revenue is being considered in the near future.
Sep 152021

Google hops on the NFT train

Not one to be left behind by a trend, Google gets involved in the burgeoning NFT market by teaming up with Canadian blockchain company Dapper Labs.

Google joins a growing list of companies to enter into the world of blockchain by inking a deal with blockchain platform Dapper Labs. The Canadian-based start-up is the creator of the Flow blockchain, and Google will help Dapper to help scale the platform – which is home to a whole ecosystem of non-fungible tokens. All of this is in an effort to power a blockchain based world wide web.
Myriam Jessier / Unsplash
Sep 142021
🇰🇷

A slap on the wrist from South Korea

South Korean regulators are coming after Google with a $177 million fine for abusing its market dominance.

Antitrust regulators in South Korea have accused Google of abusing its market dominance by hindering the development of rivals in the region, fining the tech giant $177 million. The move comes not long after Korea became the first country to force both Google and Apple to open their app stores to third-party payments systems – who could be next to enforce a similar revenue-eating law?
Sep 132021

Google gets worried over Apple's Epic ending

A federal judge rules in favor of Epic Games in its battle against Apple, causing Google to drop 1.86% on worries for the future of its own App Store.

Alphabet is in the throes of an antitrust battle against Android app makers, led by Epic Games, which is protesting against the company taking 30% commission on sales – and a ruling on Friday is a cause for concern. A federal judge ruled that Apple (AAPL) has to let apps tell their users about alternate payment methods and take them to external sites, circumventing commission charges.

Google’s own trial is over a year away, and while Epic failed to prove Apple (AAPL) is a monopolist, they now have plenty of time to hone their case.

Prices dropped to their lowest since the end of August, down 1.86% to $2817.52.
Sep 032021
🎧

YouTube Music turns it up

Alphabet’s YouTube is stepping up its music game with a 50 million subscriber base on its paid music streaming services – up 20 million from last year.

The music streaming market is a fiercely competitive one, dominated by giants like Spotify (SPOT), Apple (AAPL), and Amazon (AMZN) – but YouTube Music is planting its flag in solid ground after it reported passing the 50 million paid subscribers milestone. Numbers are up over two thirds since October last year, when the service reported only 30 million subscribers. Spotify (SPOT) boasts around 165 million subscribers, while Apple (AAPL) and Amazon (AMZN) have around 78 million and 63 million respectively, so YouTube is definitely in the game. Industry consultant Mark Mulligan from Midia Research says:

(Youtube Music is) becoming to Gen Z what Spotify was to millennials half a decade ago. Google’s YouTube Music has been the standout story of the music subscriber market . . . resonating both in many emerging markets and with younger audiences across the globe.
Sep 012021
🇰🇷

South Korea drops the hammer on big tech payment policies

Big tech is facing regulatory backlash from South Korea, which just became the first country to ban Google’s developer payments policies.

Google and Apple’s (AAPL) payments policies force developers to only use the company’s proprietary billing system, which takes a commission of up to 30%, and the policies have been a source of much contention between big tech and regulators. Now, South Korea’s parliament has become the first to pass a bill that will ban those policies, meaning developers can redirect users to alternate payment platforms and avoid paying commission. Naturally, Google isn't too pleased:

(Our service) helps keep Android free, giving developers the tools and global platform to access billions of consumers around the world. We’ll reflect on how to comply with this law while maintaining a model that supports a high-quality operating system and app store, and we will share more in the coming weeks.

The new laws set a radical precedent for sanctions on the lucrative service that could hugely affect Google’s revenue – with a real-world example of restrictions, who knows where else in the world will follow suit. Omdia analyst Guillermo Escofet, who specializes in digital consumer platforms, said:

This could presage similar actions elsewhere. The overriding political mood has become hostile to the enormous amount of power concentrated in the hands of the tech giants.
Aug 272021
😀

Self-drive scale down

Alphabet’s self-driving unit Waymo is giving up on its efforts to sell lidar sensors, and traders warn of a pullback on the way.

Alphabet’s Waymo has spent the last two years trying to make a profit from the sale of its lidar sensors, which are used for light detection and ranging in its self-driving tech. However, after failing to generate enough revenue from the sales, the company has decided to wind down its lidar business and keep the tech for itself. A spokesperson said:

We're winding down our commercial lidar business as we maintain our focus on developing and deploying our Waymo Driver across our Waymo One (ride-hailing) and Waymo Via (delivery) units.

Despite the small set-back, Alphabet stock is slowly but surely inching its way closer to the highly coveted $2 million market cap, a target which so far only Microsoft and Apple have been able to reach. However, as the stock inches up, chief market analyst Matt Waley warns that it is getting hugely overbought:

It is getting very overbought. Even the best companies, their stocks get ahead of themselves on a short-term basis. The weekly RSI is now pushing 85. That’s the most overbought it has ever been. And not only that, if you look at its 200-week moving average, it’s at almost a 98% premium to its 200-week moving average. The next closest is 76%, so it is very, very extended here on a short-term basis. I’m not saying that people should sell the stock and, heaven forbid, you definitely shouldn’t short it. But those who like the stock I think will be able to avoid chasing it up here and they’ll be able to buy it a little bit cheaper in the weeks ahead.

Prices have been breaking barriers nonetheless though, reaching a new record high almost every day this week, peaking at $2,900 on Friday. Its current market cap sits at around $1.934 trillion.
Aug 262021
😀

Big Tech gets called to the Principal's office

After a string of cyber attacks cast a scary spotlight on security issues, the White House summons the heads of big tech companies like Alphabet, Apple and Amazon to discuss how to combat the growing threat.

On Wednesday, the White House held a cybersecurity summit with all the big tech industry leaders to discuss how to bolster the nation’s cybersecurity after a series of high profile cyber attacks like the SolarWinds and Colonial Pipeline hacks showed the gaps in the current system. Biden met with over 20 CEOs from a range of industries including big tech, insurance, energy and banking, and all of them walked away having made a pledge to bolster the country’s cybersecurity in some way, ranging from new industry standards to training employees. Biden said:

The reality is, most of our critical infrastructure is owned and operated by the private sector, and the federal government can’t meet this challenge alone.

Alphabet’s Sundar Pichai said that its Google unit would invest $10 billion into cybersecurity in the next five years, and train 100,000 Americans to fill jobs in related fields.
Aug 172021

Google teams up with FB... underwater

Industry behemoths Google and Facebook team up to build a giant underwater cable that will improve internet access in the Asia-Pacific region.

Alphabet’s Google and social media giant Facebook (FB) have joined forces to bring their tech prowess to Asia-Pacific, with plans to build a 7,500 mile cable under the sea connecting Japan and South-East Asia. The new project, which is called “Apricot,” will see thousands of miles of undersea internet cable laid between Japan, Taiwan, Guam, the Philippines, Indonesia, and Singapore, and is due to come online by 2024. Facebook (FB) has offered to fund part of the project, along with a group of regional telecom providers.

Google and Facebook (FB) have partnered on similar projects before, already laying thousands of miles of cable at the bottom of the ocean together, with new plans in the works to fund two further cables between Singapore and the U.S. West coast.
Image: Yannis Papanastasopoulos / Unsplash
Jul 282021

Q2 earnings give investors Google-y eyes

Google’s parent company Alphabet crushes its second quarter earnings, reporting impressive digital ad sales numbers that jumped 69% from the year before.

Alphabet reported impressively robust earnings from the quarter ended in June, going from strength to strength even as regulatory sharks circle and wowing with its digital ad sales numbers. The industry beat on both the top and bottom lines in a big way, reporting earnings per share of $27.26 on revenue of $61.88 billion, compared to expectations of $19.34 in earnings per share on $56.16 billion in revenue.

Google ad revenue was the star of the show, further cementing the company’s status as the world’s leadest advertising engine – the segment pulled in $50.44 billion, up 69% from the same period the year before when COVID took its toll on companies everywhere, and representing around 81% of Alphabet’s revenue. Retail advertising was by far the largest contributor to that growth, with segments like travel and media seeing the biggest jump. The advertising behemoth is on the way to finishing the year with just under 29% of the global market.

Ad revenue may have been the star of the show, but there were some strong back-up dancers to boost the report. YouTube advertising revenue was up 84% at $7 billion, and its Cloud revenue brought in $4.63 billion, up 54% from the year before and slightly above the number Microsoft (MSFT) posted for its cloud unit Azure. Granted, the year-before comparisons are based on a quarter that saw Alphabet crippled by COVID, but the numbers are impressive nonetheless.

In Q2, there was a rising tide of online activity in many parts of the world, and we’re proud that our services helped so many consumers and businesses. Our long-term investments in AI and Google Cloud are helping us drive significant improvements. Our strong second quarter revenues of $61.9 billion reflect elevated consumer online activity and broad-based strength in advertiser spend,

said Ruth Porat, CFO of Google and Alphabet.

Prices ended Wednesday up 3.18%.
Jul 082021

Washington takes aim at Google

As one big tech antitrust case wraps up, another unfolds. Thirty-seven states have banded together to sue Google for alleged antitrust violations in its Android app store.

DC has got big tech in its sight, and it's not taking its finger off the trigger now, despite a string of lost lawsuits against the tech giants that seem to be slowly taking over the world. The ink is barely dry on the recent dismissal of antitrust cases against Facebook, which the judge deemed to be lacking in evidence, and already a bunch of U.S. states and district attorneys general have gotten together to take aim at Google. The litigants are claiming that Google bought off competitors and used cleverly restrictive contracts to maintain a monopoly for its app store on Android phones.

Epic Games, which is coming to the end of a lengthy court battle with Apple over accusations of similar anti-competitive behaviour (we haven't got a ruling yet, stay tuned), also filed a suit against Google last year, accusing the PlayStore of orchestrating an unlawful monopoly over the market. The federal government has been piling on the pressure recently, and has already filed three other suits against the industry leader. New York Attorney General Letitia James is co-leading the lawsuit, claiming that:

Google has left millions of Android users and app developers with no option but to use the Google Play Store. This is raising prices for consumers and squeezing millions of small businesses that are trying to compete.

Even the former President, Donald Trump, is hopping on the lawsuit bandwagon. The formal leader's social media presence was as explosive as his presidency, and earlier this year a bunch of big tech companies decided to ban him from their platforms for inciting violence. Now, Trump has said he is filing a class-action lawsuit against Google, Facebook, and Twitter as well as their executives, Mark Zuckerberg, Jack Dorsey, and Sundar Pichai, alleging unlawful censorship of free speech. That’ll make for an interesting courtroom.

GOOGL was down 1.55% in Thursday morning trading.
Jun 212021
🎉

Let's get physical

Google gets its first permanent residence, opening up its very own retail store in the Big Apple for fans to stock up on all their favorite gadgets.

After years getting its feet wet with experimental pop-up stores around the country, Google has jumped right in with its first ever physical retail store, bang splash in the middle of New York. Talk about prime time real estate. The store is designed as more of a showroom than to move a huge amount of product (think Tesla), and even has little rooms called “sandboxes” where people can go through simulations to experience a product first hand before committing.

The space has been described as a “less antiseptic Apple Store”, but it’s still an interesting decision to make given that, unlike Apple, Google doesn't exactly make a ton of money from its hardware products. By comparison, competitor Microsoft has already shut all of its permanent stores in the aftermath of the pandemic, because the internet has proved just so much cheaper. Over 80% of parent company Alphabet’s revenue is thanks to digital advertising, which generated around $147 billion last year, but apparently the aim of the new store is to understand more about what customers want from hardware. It might also help people to realize the range of devices that Google actually offers – which is larger than you might think, running all the way from traditional laptops to techy thermostats. Who said Google was just a search engine?
May 142021
🚀

Google reaches for the stars

Alphabet shares jump over 2% as Google wins a cloud deal from Elon Musk’s SpaceX to help deliver internet through its Starlink satellites. Talk about a dream team.

Google announced last week that its cloud unit is now in business with the revolutionary SpaceX after winning a deal to provide computing and networking resources to the company, delivering internet service through SpaceX’s Starlink Satellites. The new deal could last up to seven years, and shows SpaceX tapping into Google’s cloud infrastructure for its latest broadband service. The Starlink satellite internet will use Google’s private fiber-optic network to make connections better and faster. The space development company will install ground stations at various Google data centers that connect to its 1,500 Starlink satellites around the globe (literally), and hopes to be able to provide enterprises with internet that moves at the speed of light by the end of the year.

The fact that Elon Musk’s privately-held baby chose Google is a big win for the tech giant as it tries to capture control the quickly-growing and super competitive cloud computing market in the face of rivals like Amazon and Microsoft, who are already snatching away some of Google’s advertising territory. The company’s market share of search fell from 61% to 57% over the past year, while Amazon increased its share from 13% to 19% in the same period.

In making sure that Google keeps its spot as the default search engine on iPhones and other divides, its “toll fees” (the cost of all that traffic) have risen 30% to $9.71 billion in the last year. The COVID-induced surge in digital spending in the last year has been of great benefit to Google’s sales growth however, and investors are looking at its cloud business segment to boost growth in the event that its advertising segment takes a serious hit. While its cloud business is only about 7% of parent company Alphabet’s total revenue, it’s also grown by 46% up from the same period the year before, so things are looking promising.

This is one of a kind. I don’t believe something like this has been done before,

said Google’s head of global networking, Bikash Koley.

The real potential of this technology became very obvious. The power of combining cloud with universal secure connectivity, it’s a very powerful combination
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Apr 272021

Google wins big on Q1 earnings

A digital advertising boom boosts Google’s Q1 earnings, sending prices up by around 3%.

Google’s parent company beat on both the top and bottom lines this earnings season, as well as floating a new $50 billion stock buyback that’s getting investors excited already. The company reported earnings per share of $26.29 on revenue of $55.31 billion, compared to expectations of $15.82 on revenue of $51.70 billion, and posted record profits for the second consecutive quarter.

Revenue was up 34% from the same period a year ago, but the big news is that Google reported $44.68 billion in advertising revenue for the quarter - a significant increase from the $33.76 billion it reported this time last year, making it the fastest annualized growth rate in at least four years. To be fair, it cant have been too difficult to beat last year's numbers, as the COVID pandemic had taken its toll – CFO Ruth Porat warned of a “significant slowdown in ad revenues” in 2020 and has been slashing marketing budgets to save resources – but it still points to impressive recovery.

The company’s social media segments are raking in the cash too. YouTube was the winner of the pandemic in that regard, with ad revenues from the platform doubling to $6.01 billion and platform usage growing from 73% of adults to 81%. YouTube’s version of TikTok, called Shorts, is already getting over 6.5 billion views a day, almost double the numbers it was boasting in January. All in all, YouTube advertising is responsible for 15% of Google’s Q1 ad revenue.

"Our strong fourth quarter performance ... was driven by Search and YouTube, as consumer and business activity recovered from earlier in the year,"

CFO Ruth Porat said on the earnings call.

“Total revenues of $55.3 billion in the first quarter reflect elevated consumer activity online and broad based growth in advertiser revenue. We’re very pleased with the ongoing momentum in Google Cloud, with revenues of $4.0 billion in the quarter reflecting strength and opportunity in both GCP and Workspace.”
Apr 052021

Google victory

Hey, wanna hear some big news? The U.S. Supreme Court finally ends a decade-long battle between Google and Oracle, handing Google a landmark victory and sending its share price up over 4%. Fun times.

The pair have been at each other's throats for years over supposedly copied code in Google's Android operating system. Tech titan Oracle first sued Google in 2010 for copyright infringement, claiming $9 billion in damages. Oracle said that Google had “replicated the structure, sequence, and organization” of over 11,000 lines of Oracle's original code and Application Programming Interface (API); parts of which were used to build Android’s operating system. We won't get into the gritty details (over 10 years, you can imagine there are quite a few), but the debate has turned into one of the biggest software development cases in a while.

It’s pretty rare that big tech would end up in the Supreme Court, and the court actually ignored a recommendation by the Solicitor General that it should reject the case, possibly because it would have such real implications for the growing tech industry and big tech companies going forward. It’s commonplace in Silicon Valley to freely use parts of other company’s software code to develop apps and products, and if the court had ruled in favor of Oracle, effectively allowing them to place copyright on APIs; that would mean an increase in the power of the dominant tech companies that control the most widely used technologies, which could impact competition.

Luckily, the court found that Google’s use of the code was “fair use” because it only used parts of the language to create a “new and transformative program”, which would foster innovation and competition. Justice Stephen Breyer, in his written opinion, said that "to allow enforcement of Oracle's copyright here would risk harm to the public".

Strong win for Google there.