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Google Announces Fourth Quarter and Fiscal Year 2023 Results [pdf]
- samspenc 3y agoSummary from the release for Q4: - Revenue increased from $76B to $86B (13% increase) - Operating income increased $18.1B to $23.7B - Net income increased $13.6B to $20.7B - Diluted EPS increased $1.05 to $1.64
- etamponi 3y agoOkay so why is GOOG -4% in after hours this time? :)
- sillysaurusx 3y agoThe market can remain irrational something something. Besides, it’s a good opportunity. If it’s down, the stocks are on sale. I still regret not buying Meta when the markets were crashing last time.
- mydogcanpurr 3y agoI don’t know if it’s the actual reason, but they missed ad revenue expectations according to Yahoo. https://finance.yahoo.com/news/stock-market-today-nasdaq-falls-ahead-of-big-tech-earnings-210135193.html https://finance.yahoo.com/news/stock-market-today-nasdaq-fal...
- atorodius 3y agoHm there it says Revenue, excluding traffic acquisition costs: $72.32 billion vs. $70.97 billion expected ($63.12 billion in Q4 2022) Adjusted earnings per share: $1.64 vs. $1.59 expected ($1.05 in Q4 2022) Cloud revenue: $9.19 billion vs. $8.95 billion expected ($7.32 billion in Q4 2022) Ad revenue: $65.5 billion vs. $65.8 billion expected ($59.04 billion in Q4 2022) I hope that 0.3 is not the reason for that slip haha
- boomfunky 3y agoThere could be other factors in play like the recent volatility in Netflix within the same sector, as well as the upcoming FOMC meeting tomorrow causing increased fear. Markets aren't always as accurate and efficient as some believe, and stock prices always become more volatile around earnings.
- jsnell 3y agoAll those other factors would have been priced in at the end of the day. The only new information since then would have been the earnings release. If the absolute numbers are better than expected, then maybe it's the relative numbers (as compared to Microsoft who also released earnings) that are worse than expected?
- pie420 3y agoAlso keep in mind that the "expected" are not the actual expected, but rather "publicly expected numbers that are freely given out and therefore useless". Investment firms have private expected numbers that are far more accurate, the publicly given out ones are designed to manipulate retail investors.
- boomfunky 3y agoCompletely true, it would be a combination of both. Clearly it didn't meet a lot of expectations indicated by the selloff, but selling could also be aggravated by a sell day in the Nasdaq/XLC and high impact economic events on the horizon. This is all conjecture from me, I am by no means a market expert, just offering a way to rationalize the above comment on how a good/"not that bad" earnings report can still result in a stock having a large selloff.
- matwood 3y agoGoogle missing on ad revenue is like Apple missing on iPhone revenue. It's even worse for Google because it's a larger part of their business. Is the miss a blip or a signal of a slowing ad market or are LLMs eating into their business? Hard to know, but that's the concern.
- methodical 3y agoWithout being an expert in these matters it could be that while the earnings were good they may have already been "priced in"[0], so if the earnings weren't quite as high as expected or particular areas of revenue have contracted unexpectedly[1] then it could cause the price to move downwards. It could also be a result of larger market fluctuations, as a lot of larger F100 companies have also gone down by a similar amount today[2]. Any one of these factors or a combination of them together is likely the cause of the stock price movement seen today. [0] https://www.kotaksecurities.com/articles/it-is-priced-in-what-does-that-mean/ https://www.kotaksecurities.com/articles/it-is-priced-in-wha... [1] https://finance.yahoo.com/news/alphabet-misses-expectations-on-ad-revenue-sending-stock-lower-211113425.html https://finance.yahoo.com/news/alphabet-misses-expectations-... [2] https://www.investors.com/market-trend/stock-market-today/dow-jones-futures-key-economic-data-alphabet-amd-microsoft-to-report-earnings/ https://www.investors.com/market-trend/stock-market-today/do...
- VirusNewbie 3y agoI think this happens every quarter.
- BillSaysThis 3y agoAfter hours trading is also usually more volatile than regular hours, check in the morning and see where $GOOG actually opens.
- DannyBee 3y agoIn the 18 years i've been at GOOG, what direction the stock moves post-earnings is always random, and then talking heads try to post-facto rationalize it. I've seen Google blow away earnings and all expectations and be down 10%, and completely miss expectations and pop up 5%.
- renewiltord 3y agoEveryone has an explanation for this but a while ago there was this online game someone made which would give you some metric about some public stock and then you had to guess to buy / sell. It's not that straightforward. Here, GOOG was $144.99 on Jan 18 and $144.50 on Jan 30 and this is supposed to be some dramatic shift in things? Bullshit.
- asdajksah2123 3y agoBecause expectations were higher?
- wtf_is_up 3y agoTypically, that happens when forward guidance given on the call does not meet expected forward guidance.
- FredPret 3y agoFor a distributed decision-making method like the market, there is no single reason. Every buyer and seller has their own price and own reason for it.
- ardel95 3y agoThe absolute performance isn't very important for the stock price. What matters way more is the performance vis-a-vis market expectations. So in this case, the market was expecting something better (or there was some other guidance in the report that spooked investors).
- dboreham 3y agoTwo things: 1. "sell on the news" 2. results vs "expectations"[1] "expectations" is a weird Wall St concept where some small number of people who don't necessarily know much get to invent a set of numbers for the company results in the future. Then a bunch of other people who know even less believe/pretend that those expectations mean something, and will buy/sell the stock accordingly when the actual results are revealed. Yes Kabuki Theater. Actually it's about as bogus as software project planning/management, so perhaps all fields have similar made up nonsense. Hopefully not the people designing bridges. Or airplanes. Oh wait...
- impulser_ 3y agoStock prices are always pricing in the future, not the current.
- lamontcg 3y ago"buy the rumors, sell the news" combined with "priced for perfection"
- jwr 3y agoI highly recommend reading the excellent book "Financial Intelligence" if anyone wants to actually interpret these numbers. Having read the book, the section "Change in Useful Lives of Our Server and Network Equipment" immediately caught my eye. It's a classic maneuver.
- HDThoreaun 3y agoGoogle does that "change in useful lives" shit constantly.
- alberth 3y agoWho’s the author of “Financial Intelligence”? Amazon has multiple books with that title.
- kqr2 3y agoI believe: https://www.amazon.com/Financial-Intelligence-Revised-Managers-Knowing-ebook/dp/B00AXS5EAK https://www.amazon.com/Financial-Intelligence-Revised-Manage...
- jwr 3y agoYes, I meant the one by Karen Berman. It's a fantastic book, very accessible, and worth reading for anyone interested in business.
- deleted 3y ago[deleted]
- sotix 3y agoYou missed some important bits! Total costs increased from $57.9B to $62.6B, and Net income increased from $13.6B to $20.7B
- tra3 3y agoThis caught my eye, total employees - 2022: 190,234 - 2023: 182,502 Total increase in revenue of 10 billion. Not sure what conclusion to draw from this, but being a software engineer I found employment count interesting. Though 5% change in head count seems hardly major.
- eitally 3y agoI wonder how the TVC headcount has changed y/y. They don't publish that data.
- candiddevmike 3y agoThat doesn't include the army of contractors they have/had that were laid off.
- bqmjjx0kac 3y agoClearly, those 8000 employees were producing -$10,000,000,000 per year.
- shermantanktop 3y agoMath checks out. Imagine what happens when they lay off 800k!
- hiddencost 3y agoA Google SWE costs the company around $750k average, fully loaded cost. So if those were all SWEs, $6B/yr isn't an unreasonable estimate.
- dieortin 3y agoAssuming those SWEs produced absolutely zero value to Google, which I bet is not true
- bqmjjx0kac 3y agoAlso, I'm guessing legal fees and the raw cost of severance are no joke.
- resolutebat 3y agoGoogle Cloud made $864M in profit in a single quarter, more than ever before. Google Bets lost $863M in the same period, much less than ever before.
- jeffbee 3y agoI wonder if that is good news. You can look at it either as they slowed how much money they pour into the moonshots incinerator, or they stopped investing in potential unicorn lines of business.
- Kluggy 3y agoI think they have proved that it's a incinerator at this point.
- jeffbee 3y agoWell, a lot of the money goes into Waymo which is just ramping into revenue service. With the filing they submitted last week, they want to serve all of Silicon Valley and all of Los Angeles County, which is more than an order of magnitude expansion in their market. Waymo might be a real investment and not just an emergency profit reducer.
- disillusioned 3y agoWaymo _might_ be the sole survivor here... they are ABSOLUTELY trying their damndest with it. It's remarkable to not go a single day without seeing a driverless Waymo doing its thing. (I live in Central Phoenix, they're _everywhere_.) The core concept is being proven pretty well, in markets with good weather and good roads at least... whether they can achieve some sort of critical mass that allows them to recoup any of the investment, even on a single capitalized vehicle... who knows. I've heard each Jag costs ~$250k fully loaded... that's a lot of ~$14-on-average trips before breakeven, and obviously the trips aren't free. That all being said, riding in one feels like the actual future, and if they close in on this first-mover advantage and keep on keeping on, and strengthen their Uber integration, and open in more and more markets... there's a real chance they establish themselves and make this thing actually capture a significant portion of the trip economy. That being said, it's not generalized, so opening markets is expensive because they're all individually trained for each mile of road in the market, I expect they'll be functionally useless in bad winters (but that's not a dealbreaker, per se), and those operating expenses remain high. Though I do expect we'll begin to see those lower, now that they're so deep into the proof of the concept. (They're finally starting highway driving here in PHX, which is really the last hill to climb.)
- Always42 3y agoFrom page 1: The following table summarizes our consolidated financial results for the quarters and years ended December 31, 2022 and 2023 (in millions, except for per share information and percentages But the numbers appear to be billion (no way revunue 80mil) in the following table? what am i missing
- deleted 3y ago[deleted]
- goalonetwo 3y agoI really think we are at the inflection point where Google is seen and perceived as the next IBM. More and more people now realize that the ad/attention economy is overall a bad thing for internet/the world. Googler who at some point were seen as above-average engineers are now seen as leetcoders TC-Maximizer with very little ethical thoughts or opinions on what they work on. All of those changes are a positive thing.
- Moldoteck 3y agoads sector will only grow. chatgpt-like tooks will be able to integrate ads, a lot of new articles will have autogenerated ad pages, apple launched apple vision + meta's quest 3 is already released which gives a lot of new ad opportunities. And that's just the tip of the iceberg, there are a lot of places where ads are not yet integrated, but some already moved to this direction (like ad tier in netflix and judging by their userbase nr increase, more changes will follow) So idk, I don't think we are at some inflection point at least for now&near future