Google is the next Yahoo?
Google's basic problem: search ads are incredibly profitable when you're #1. But they've saturated that market. Nothing else they do with their excess cash can match those returns. If they do something less profitable, the stock price goes down.
Hence Alphabet's search for a "moonshot". But what management meant by "moonshot" was another high volume product with a huge return on investment. That's probably not going to happen in the home appliance space, which is price-sensitive and competitive.
"The online-video unit posted revenue of about $4 billion in 2014, up from $3 billion a year earlier, according to two people familiar with its financials, as advertiser-friendly moves enticed some big brands to spend more. But while YouTube accounted for about 6% of Google’s overall sales last year, it didn’t contribute to earnings. After paying for content, and the equipment to deliver speedy videos, YouTube’s bottom line is “roughly break-even,” according to a person with knowledge of the figure."
[0]http://www.wsj.com/articles/viewers-dont-add-up-to-profit-fo...