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chollida1

Haven't posted one of these in a while

Numbers:

- 3Q Operating Income $9.18B, Est. $9.45B

- 3Q Revenue $33.01B, Est. $32.72B

- 3Q EPS $10.12, Est. $12.35, pretty darn big miss, Porat dropped a pretty big ball here

- CapEx up 26% yoy

- headcount up to 114K from 94K a yaer ago

- Other Bets revenue is $155 million, up 6%

- Other Bets losses is $941 million, up 29%

Adds:

- paid clicks are up 18% vs 32% last year

- Porat pointed to two main issues on revenue

  - legal settlement with France

  - losses from venture investments, not stated what and why, did clarify that the loss is unrealized and they gave back $227 in performance fees!!!!!!

- Porat didnt' talk about fitbit rumors, though given that FIT is up 30% I don't think she needs to say anything

- nothing on China

- Google is now one of the largest spenders on lobbying goverment, They must take Warren seriously

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Headcount up 21% in 1 year. Can we get a breakdown of which roles they are in? Or which cities/countries?

From what I read, cloud is massively expanding headcount in sales, marketing, and support.

Support?

Are we still talking about Google?

Yes, businesses paying the big bucks tend to get a different level of service than consumers using stuff for free.

Even me and my 2 count G Suite account gets support.

They are actually pretty good for services/products you pay money for. I had some Google Home/Nest Thermostat integration issues recently and was super impressed with their tech support people.

> They are actually pretty good for services/products you pay money for

As long as it's not AdWords. I've used it for something like a decade, and the support was and is, crap. Indeed, if you somehow manage to speak to an actual person, all they do is try to adjust your account so you'll spend more.

Ruth Porat states in the call the majority are engineers and product managers. Though that doesn't tell you much about where they're at or what they're working on.

I thought I heard her saying it was mostly on R&D and Sales and Marketing. Which doesn't tell you much I guess.

20% headcount growth in year happens regularly for Google like in 2010, 2011-13, 2016 and 15% seems to be lower bound:

https://www.statista.com/statistics/273744/number-of-full-ti...

And from their jobs postings, people around, etc. it seems they are just beefing up the org as usual plus some active moves in the "strategic" orgs like cloud, etc.

Moving protobufs.

Not the first time I've heard this joke. Is this a real task commonly done on teams at Google? Is it due to monorepo particulars?

It's because Google has lots of internal services (sorta like microservices) and that's how services communicate with their neighbors. In some cases, persistent data is in protobufs too.

The point is probably doing some kind of storage, calculation, or aggregation of data, but "moving protobufs" sounds funnier.

It is so true that it even has its own T-shirt!

https://www.google.com/search?q=larry+sergey+protobuf+moving...:

It's not really because of the monrepo. Think about how many jobs outside Google involve moving JSON data around (and manipulating and transforming it). At an Alphabet company, that work would likely use protobufs instead of JSON.

At the end of the day, all software engineers are moving, transforming and persisting bits.

Languages abstract bits to types. But, there is no universal langauge for storage, retreival, front-end rendering and middle-layer logic, so engineers have to fall back to sort of thinking in bits again as they interact with various systems.

Protos are Google's fairly successful attempt at raising the abstraction level to object / document so that programmers can store, retrieve, transform objects at all layers.

Senior staff protobuf engineer

For reference, Google pays $1B in taxes and fines to France, September 2019. https://www.euractiv.com/section/digital/news/google-agrees-...

Something else that's interesting is the doubling of the effective tax rate from 9% to 18% yoy. Is there any explanation for that?

Last year it was abnormally low: “Our provision for income taxes and effective tax rate decreased from the three months ended September 30, 2017 to the three months ended September 30, 2018. The decrease is primarily due to the effects of the Tax Act that became effective in 2018 and a decrease in unrecognized tax benefits in 2018 as compared to 2017.”

Interesting that tax reform was credited as the main reason for increased taxes paid by one of the largest conglomerates in the world.

The corporate tax rate was lowered from 35% to 21%, but Google's bump from 9% to 18% might be evidence that there are now fewer loopholes. Hopefully there will be media articles analyzing this example.

Wasn't tax corporate tax "reform" in effect last year as well?

The low 9% effective rate last year was due to adjustments related to the tax reform. The 18% this year is back to normal.

Aren't the venture investment losses probably due to Uber's stock price? They owned a sizable chunk. I'm not sure if they sold it all.

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