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My guess is where it's been going for a while, in line with the signals sent by hiring their new CFO - juicing shareholder value by cost-cutting now that the ea

My guess is where it's been going for a while, in line with the signals sent by hiring their new CFO - juicing shareholder value by cost-cutting now that the easy gains have been had and "natural growth" is slowing.

adventured 5y ago
Their gains are extraordinarily easy still. 2020: $41b operating income. 2021: $78b operating income (+$37b in one year). 2018: $31b operating income. 2019: $36b operating income. So they just added an entire 2018 or 2019 size profit to their outcome in the past year. That didn't come from squeezing pennies on little storage products and the like. That's from one of the world's largest snowballs continuing to roll down hill, piling up tens of billions in trivially easy profit addition as they go. When it comes to expanding margins, for an organization the size of Google that is still expanding relatively quickly in sales, it's far more important to hold down cost expansion as the profit soars (don't add those entirely unnecessary 20,000 heads) than it is to cut rounding error costs. Microsoft has similarly been masterful about doing that lately (unlike during the Ballmer era).
- lostmsu 5y ago
  Question is: is this extra income here to stay in 2022?
  - antoniuschan99 5y ago
    Most likely. Search continues to be strong and nothing has come close to bypass the moat. Facebook on the other hand, their moat has been broken through and they're knocking at the door of the castle :P Their deal with Apple ensures their staying power. They own the other half of the Mobile ecosystem so even when lockdowns end and travel opens up there may be even more usage.
- pjc50 5y ago
  Where did that growth come from? Is there a breakdown somewhere?
  - belter 5y ago
    Same cash cow as always. Money from companies who think we browse the web without AdBlockers. A little bit YouTube adds. They tried to spin it as growth on Google Cloud, but its minimal, compared to the cash cow. https://abc.xyz/investor/static/pdf/2021Q4_alphabet_earnings_release.pdf?cache=d72fc76 https://abc.xyz/investor/static/pdf/2021Q4_alphabet_earnings...

adventured 5y ago

Their gains are extraordinarily easy still. 2020: $41b operating income. 2021: $78b operating income (+$37b in one year). 2018: $31b operating income. 2019: $36b operating income. So they just added an entire 2018 or 2019 size profit to their outcome in the past year. That didn't come from squeezing pennies on little storage products and the like. That's from one of the world's largest snowballs continuing to roll down hill, piling up tens of billions in trivially easy profit addition as they go. When it comes to expanding margins, for an organization the size of Google that is still expanding relatively quickly in sales, it's far more important to hold down cost expansion as the profit soars (don't add those entirely unnecessary 20,000 heads) than it is to cut rounding error costs. Microsoft has similarly been masterful about doing that lately (unlike during the Ballmer era).

lostmsu 5y ago
Question is: is this extra income here to stay in 2022?
- antoniuschan99 5y ago
  Most likely. Search continues to be strong and nothing has come close to bypass the moat. Facebook on the other hand, their moat has been broken through and they're knocking at the door of the castle :P Their deal with Apple ensures their staying power. They own the other half of the Mobile ecosystem so even when lockdowns end and travel opens up there may be even more usage.
pjc50 5y ago
Where did that growth come from? Is there a breakdown somewhere?
- belter 5y ago
  Same cash cow as always. Money from companies who think we browse the web without AdBlockers. A little bit YouTube adds. They tried to spin it as growth on Google Cloud, but its minimal, compared to the cash cow. https://abc.xyz/investor/static/pdf/2021Q4_alphabet_earnings_release.pdf?cache=d72fc76 https://abc.xyz/investor/static/pdf/2021Q4_alphabet_earnings...