Alphabet Q2 FY2022 Earnings [pdf] | Hacker News Reader

Alphabet Q2 FY2022 Earnings [pdf]

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Marginally better numbers than expected. Stock is up ~3% after hours.

Worse than expected by analysts, better than expected by investors. It was technically a miss

Analysts got it wrong again?

Alphabet are known for not providing any guidance to the analysts so I would take that with a pinch of salt.

Consensus seems to be that the results could have been worse. Some signals that large advertisers are pulling spend in some areas. If that continues, you would expect Q3 earnings to be below the upward trajectory that Alphabet have enjoyed for years.

Let's not forget that that "upward trajectory" included a near 70% year-over-year increase in revenue on a stock market where 4% is the long-term norm. And Google did that, not as a $100k Market cap stock but as a $1 trillion market cap stock (ok 1 trillion ... after the gain). If Google's revenue stood entirely still for 3 years, they would still have outperformed the S&P500 comfortably. Frankly a -20% YoY revenue (the minus sign is not a mistake) would have been an excellent result.

This is truly remarkable performance.

There was a pullback because of the SNAP earnings and the sentiment was that the earnings are going to be bad. The reaction is to the fact that earnings weren’t bad, missed by a small number and revenue was up overall.

Crazy good numbers given the environment and their size.

Revenue grew 13% or 8B but operating income fell as did net income. Yikes. Either that additional 30k in headcount really took a toll or they are investing heavily in other areas. That or acquisition costs are rising. (I’m still reading the PDF).

Ahh pages 4 and 5 make more sense now. TAC went up 2B but also costs of revenue as well.

Total costs and expenses 42,519 50,232 (2021-2022) cost of revenue tracked more or less 1:1 with rise in revenue which is why net income was the same. Hmmm.

Capex spend is one area mentioned in the Investor Relations call - primarily new datacenters, office fitouts and server purchases.

Comparing q2 in 2021 and 2022 is difficult because the pandemic boosted revenues in 2021 but capex spend was delayed. And in 2022, some revenue didn't materialise due to uncertainty but investments for the future are being made.

As usual with alphabet, look at the mukti-year trend. And don't be surprised to see investment in bets that will pay off in 5+ years time.

I would guess that all three major public cloud providers will have great growth at least for a decade ahead. People here sometimes forget that there are companies outside Silicon Valley startups.

They took a pretty big loss on debt and equity securities this quarter, compared to a profit in Q221. Roughly a $3B hit to net income. This might be realized or unrealized (mark to market) losses.

See page 9.

Ah but remember it’s “hard“ somehow to give google money. I read it here on HN. No idea where these billions came from.

Google might be the easiest company ever to give money to.

1. Open Browser to google.com

2. Type something

3. Press enter

You're selectively ignoring the context of that thread relative to this report for the sake of snark.

For those wondering: https://news.ycombinator.com/item?id=32237445

That thread was about (being unable to) pay for Google Ads, which is where the majority of Google’s revenue comes from.

If it were commonly the case that paying Google is difficult, you’d see it reflected their earnings.

The earnings call will be interesting.

What specifically about this particular earnings call will be interesting? I can't see anything of note that hasn't happened 20x before.

Tiktok threat, current macro conditions, future quarter expectations, layoffs...so many things

I mean, sure but those are run of the mill things that can be said for almost every earnings call.

Okay, I just said it would be interesting...it can be run of the mill + be interesting...

How is TikTok a threat to Google?

Their core business (advertismenet) isn't affected so far.

Numbers:

- Q1 EPS $1.21 vs EST $1.32

- Q2 Rev. of $70B vs est of $70B

- Ad Rev. $56.3B vs EST of $56B, grew 12% on the year, good job!! but growth is way down from last year.

- this add revenue is good, which indicates they aren't really affected by the Iphone privacy changes like META is.

- operating margin came in at estimates

- cloud lost $858M which is higher than expected

- cloud Rev was 6.2B which is about what was expected

- Other Bets lost $1.7B, which is small enough no one will care

- other best revenue is $190M

- stock is down about 24%, wich is a beta of almost 1, maybe googles growth is done and its becoming a typical old boring stock that just makes money now

To Watch:

- all advertising is slowing, Twitter, Snap and Pins are all below their IPO price and META is down big, whatch for GOOG advertising, though normally you'd expect search advertising to be more resistant

- watch youtube add numbers, it really seems like they are playing alot more adds, normally I see 2 before each video now

- will google cloud start to approach the big 2 of azure and aws

- will they talk about hiring or layoffs

Notes:

- add revenue held up ok, compared to peers

- other bets continues to not matter, at some point waymo has to put up or get shut down

- will cash on hand grow or shrink? Looks like its down by about $10B

- cloud unit disappoints with revenue

- shares relatively flat after hours( up maybe 2%), probably a good trade to buy their peers now(snap, pins, etc, meta)

- whoever runs Google cloud must have blackmail material on Pichai, AWS and MSFT run big profitable operating margins and google cloud is losing money, this is something they should be good at, but they are somehow the only one that has figure dout how to lose money on what is a cash cow for the big 2.

What is going on with their cloud offering??

- zero hedge tweet that they've repurchased $15B of stock

> stock is down about 24%

I thought you meant it had massively crashed on this earnings

It's down ~24% YTD (along with basically every other stock).

Up ~2% after hours on this earnings report

Why is cloud a loss for Google but a cash cow for Amazon?

Lots of capex

Because Google is playing catch up and needs to pay higher salaries to poach from MSFT and AMZN and also pay much more for infra than what Amazon paid for theirs initially.

Google has been "playing catch up" for a decade now. They also pay less than Amazon (source levels.fyi)

From what I hear they paw software engineers less, but find it harder to attract sales personnel, as it’s easier to sell the industry leader (IBM, Oracle vs ???). No sources, just some posts a few months ago.

Google does not pay less than Amazon (source levels.fyi https://www.levels.fyi/?compare=Amazon,Google,Salesforce&tra...).

I have heard people claim that Amazon pays more and by that they mean that if you hold your Amazon stock until vesting, it appreciates so much that it ends up being worth more than whatever the Google grant would have been worth. But then you have to ask if the relative performance of the stocks will remain stable over time despite having changed recently, and factor in differences in employee churn and so on.

They pay about 100,000 less. Its widely known, not sure why you are arguing this. Amazon also raised their paybands massively, so a blanket comparison doesnt reflect reality. Look at individual data over the last year or so. Google also downlevels, so comparing levels makes less sense, compare years of experience instead

Back last July, AWS couldn’t come close to what Meta or Google could offer when I was looking.

> Amazon also raised their paybands massively

that $350k base limit is top of the band, not everyone walking inside the door is going to get that. A friend of mind got an offer from AWS about a month ago, his base was offered $180k

Very wrong.

What does Google still need to catch up on in cloud? Building products/services? Sales? AFAIK, they have comparable cloud services to most AWS/Azure offerings.

Trust for one thing. They just cut off customers services with line of recourse. Also shut down products with little warning.

I don't think shutting down products applies to GCP services. Even if it did, it doesn't explain the $858M loss. They are spending big on something to "catch up", I'm just not sure what it is.

IIRC it's mostly incentives for large companies to jump ship

> shutting down products applies to GCP services

they regularly deprecate old API versions in favour of new ones, which are not backwards compatible and usually more expensive

any time Google Cloud APIs change you have to update your code

and they break stuff, introduce bugs more often that you'd expect and prioritize new features over fixes (see bugtracker for confirmation)

this is why i'm never again touching GCP

Mostly I think it’s just acquiring customers. The big cloud providers go to great lengths to lock their customers in, so convincing them to switch is hard. Requires a much better product which seems pretty much impossible against aws and azure or a much cheaper price.

From someone who does enterprise technical sales for a B2B company: Identity Management is a major area of concern for GCP / GSuite, at least in the enterprise space, especially for the low to moderately technical folks that I sell to. The same could be said for AWS but they have first mover advantage in many ways.

IIUC, Google w/o cloud or YouTube handles more network requests, storage, and bandwidth than Amazon + AWS by a large margin.

They don't need to "catch up" on infra. They need to catch up on their product offering.

They also offer insanely cheap deals to nonprofits and education for both GSuite (or whatever they call it these days) and GCP. Totally makes sense why they do it but I have to imagine its a huge loss on paper.

They also might be building more actual datacenters and doing so in a high end / environmentally friendly way whereas perhaps Amazon has already done a lot of those investments in previous years?

>… insanely cheap deals to nonprofits…

Amazon and Microsoft both do that as well.

Probably because Amazon is better at retail sales. For larger companies both Amazon and Google give an enormous amount of incentives to secure the accounts, so they have lower margins. Where they thrive is with smaller and medium businesses. Amazon is better at the market of selling to the average joe.

Microsoft is also good at upselling Azure through existing customer relationships, and almost every company is a Microsoft customer.

Sales also just isn't in Googles DNA.

It's an uphill battle for Google.

AWS was actually able to add enterprise sales after realizing it needed to. Not clearly Google has done nearly as good a job.

Google has a cash cow and isn't hungry. Their employees can half-arse the rest of their business and still be confident they'll get paid at the end of the week. Amazon's retail arm bled when AWS was started, and still bleeds. Success is a matter of urgency.

AWS early mover advantage?

This.

In medium sized companies no one cares how expensive is the cloud bill.

What matters is getting the infrastructure and any devop and many devs are already used to AWS so it is chosen by default.

Because Google is absolutely awful at Cloud and they have to subsidize heavily to attract customers.

Their cloud platform is fantastic if you're trying to stay on vanilla k8s and standard managed DBs without getting into vendor lock-in territory.

Their management UI is an order of magnitude better than AWS garbage. It's clean, informational, and easily navigable.

Spanner great, but I'm not using it for my startup.

Anyone who says using K8s on any cloud provider prevents “lock in” has never done a large scale migration.

You’re always “locked in” to your infrastructure at scale.

> Their management UI is an order of magnitude better than AWS garbage. It's clean, informational, and easily navigable.

I've never seen someone calling a glacially slow, inconsistent, cannot-even-display-graphs-90%-of-the-time, information-hidden-behind-multiple-steps abomination of GCP Console that.

A lot of the cost structure is ~fixed (and high). It's pretty much the ultimate scale game.

I don't think Waymo will contribute meaningfully to the bottom line for at least another 3/4 years, however people had the same mentality of "put up or get shut down" regarding YouTube a few years ago, and we all know how that turned out. That said, I'm still very bullish on both the stock and Waymo specifically.

Waymo won't contribute meaningfully for at least 2 decades. Bottom line = profit. Top line = revenue.

Adding more ads and bringing down video serving costs are tangible, achievable goals. Solving self driving is not. I honestly don't think Google has the right culture to deliver either. There's no hunger to win there.

I'm not sure self driving is a matter of Google culture. It's just become pretty evident that, while maybe some limited fully self-driving use cases will become viable in the next decade or two, this idea that you can have your personal chauffeur whisk you door to door even in an urban environment perhaps in your lifetime so you never need to own a car is not happening. And that really disappoints some people who bought into the idea.

I certainly hope AGI happens in my lifetime.

1. I doubt it

2. Be careful what you wish for

You do realize that people are being whisked door to door in an urban environment today, right? And not just by Waymo but Cruise as well. Sure it's small scale at the moment and not available to the average person, but it's happening.

Waymo isn't part of Google though, it's a separate company owned by the Alphabet holding corporation. The other bets within Alphabet do have cultures that are different from Google.

Anyway, I think Waymo is doing much better at this than the rest of the competition. If not Waymo then who? Uber's approach was much worse, and got canceled.

Main numbers are these:

--- start quote ---

- Q2 Rev. of $70B vs est of $70B

- Ad Rev. $56.3B

--- end quote ---

80% of revenue is advertising. That's all you need to know about the company's direction and incentives.

I would submit that knowing the trend of ad revs as a percentage of the whole would tell you more than a single snapshot, which has no direction itself.

That’s down from 97%+, the direction is more important than the current number since the change over time indicates how the company is evolving and it is obviously moving towards diversification.

It has been hovering around 80% for a few years now, hasn't it?

It's their cash cow. Why would they stop?

But that 20% isn't advertising is much better for Alphabet than compared to 10 years ago. Waymo is the next big bet.

Waymo isn't a bet. At least, isn't a bet that is projected to be even remotely cash positive, much less having a significant percentage in Alphabet's revenue, in any foreseeable future.

That’s not how I heard it was viewed internally a few year ago.

By who?

Nothing that’s public.

All these "north star goals" and "company bets" are often pipe dreams.

Waymo has been around for 13 years now. It's bet is to have full level 4 autonomy, at least. And that is another 20 years away in an optmistic scenario.

Well, unless you only drive on sunny days in a geofenced region in Arizona and call crashing into a bus "a misunderstanding and a learning experience".

> at some point waymo has to put up or get shut down

obviously noone is expecting significant revenue there last quarter or any near future ones so it's pretty irrelevant how they do on quarterly reports. It's been over a decade and they seem to now be making serious progress. That "some point" isn't going to be this quarter or next quarter or sneak up by surprise on anybody

> - this add revenue is good, which indicates they aren't really affected by the Iphone privacy changes like META is.

ad density would be an interesting figure. YouTube is unwatchable with ads turned on.

That sounds like the sorts of results that tend to hammer a company. Some barely beats on low expectations. A bunch of expectations barely or misses.

Likely, google perceives that their cloud losses are about on par with what they’d lose on software/other expenses if they shut down gcp and continued in house with their infrastructure (rightly or wrongly).

Compared to other bets, the loss is not large compared to growth opportunity. however the absolute numbers in these losses are interesting in and of themselves. There are clearly extremely large divisions which produce negligible revenue, let alone profit.

Wasn’t the whole problem with Google Cloud that they did, in fact, not dogfood this and their internal infra is completely separated?

Google added nearly 30k employees in the prior year.

No way that amount of growth is sustainable. I doubt even half of those employees are up to speed sufficiently to add value to the company. Just absorbing that many people means scores of new teams, hundreds of new managers, and mountains of additional hardware.

I'm sure they are seeing this in the costs.

> hundreds of new managers

Thousands of new managers. Think about that.

what does a manager actually do in a software business these days?

Depends how competent the people they manage are. Anywhere from invasive micromanager, to "do little" figurehead that conveys information.

The best people don't need to be managed really, just alignment of direction, but there are far too few of them to depend on that at scale

I am not convinced the best people are few and far between. I think we could have said that about women doctors in the 19C or poor people at any time.

Then again ... maybe

At Google? Cross org coordination, identifying and prioritizing opportunities, work trading with other teams (you do this and I'll do that), communicating why the team's work matters to mid management that has no idea, helping engineers avoid pitfalls, helping engineers craft project portfolios and a narrative for promotion. Helping engineers develop the right skills to succeed at Google.

They create value [1].

[1]: https://www.youtube.com/watch?v=DYvhC_RdIwQ

Your link sent me down a rabbit-hole -- their "microservices" video is very good, and excellent commentary on current trends.

So much of this fits under "marketing our value to rest of the org" - which to me (who is convinced democracy matters) says the organisation is lacking ... journalism and open fair competition of ideas.

Having the best idea reliant on top / upper top managers spotting the best idea is ... not great. And I am not convinced that having a "good communicator" as the solution - because what if the well connected manager is on the poorest product solution?

As for the rest - yes google has 8 whatnots for managers that read as a coaching manual - its important yes, but I would be astounded if there are not better things to focus on.

If a good manager is like an army sargeant, who are the colonels and generals? Where is the operational plans? Maybe I just get kept in the dark and fed shit but an open and coherent communication will get people aligned without being micromanaged

Mostly glueing people around. Sounds like a mediocre job, it's as important as writing glue code. Not interesting, but most of the code written nowaway are glue code...

But is it given the importance, remuneration and status of glue code?

No.

I think that is my issue. Most "management" decisions Inthinknwouod be better done in the open, possibly involving voting, discussion / debate.

Not chosen by an unelected cabal with time and stress issues.

Google funds a huge number of teams internally that (in my opinion) don't do anything that contributes to the top line or bottom line or the company's image.

Not only that, but Google is known for being a "chill" place to work - good WLB, low pressure to deliver, very low chance of PIP. That attracts the wrong kind of employee. When you start seeing TikToks of people who work at Google documenting their life rather than delivering results, that's when you know the company's standards are too low.

Think about all the chat apps we'll have in a year...

That's ~575 new employees per week (probably more, making up for turnover)! Absolutely wild.

But don't worry. They've paused hiring for two full weeks!

Not really that crazy when you have 174,000 employees. A 20% increase in employees isn't really that high when you also have a 13% increase in revenue.

Procuring 30,000 laptops is quite different than procuring 200 laptops. The logistics for 20% growth are materially different for a 100,000 person company vs a 1,000 person company.

> Procuring 30,000 laptops is quite different than procuring 200 laptops.

Yes, you get a cheaper per-unit basis in bulk, and it becomes worth investing in larger scale automation to set up those laptops, so that the per-laptop cost of getting them ready for the employees is cheaper too. Economies of scale work in favor of larger numbers. A company that "only" procures 200 laptops per year won't even have a dedicated person for that job; if you're procuring 30k laptops per year you're going to have several full-time people whose only responsibility is working on and improving that process.

Dwarfed by the advantage of printing billions per quarter in profits.

Every employee they add also takes potential talent away from adding value to a start-up or competitor trying to catch-up. It's one way to protect your monopoly when there is a shortage of skilled labor.

This is how I think as well.

The suggestion here being that hiring is a strategic play by Google to prevent startups from forming?

I think a much better play is to let the startups form at no cost to you and buy them if/when they show signs of success.

Sure that’s viable but also hiring top talent means that talent can’t join Meta (sic) or Microsoft or Apple etc. keep the brain trust full and add to your advantage.

The feds surely won’t allow it for ever though. There’s already so much scrutiny.

I think this is basically wrong. One thing lots of companies do during a recession is they try to get rid of the worst 10% of their employees. Instead they lose the top 8% and the bottom 1% and a random 1%- the top 8% see the bad news, have options and leave, the bottom 1% are obviously bad and get let go, and the other 1% are just unlucky becuase the company doesn't really have a clue who is good.

This the same thing for trying to corner the smartest engineers in the market. You're not going to corner the smartest engineers, the smartest are going to go off and work on interesting meaningful projects. But what you will get is a lot of employees who are smart, not that effective but very happy for you to pay them not to work anywhere else.

So even if the intention is to corner the top talent, they're not going to succeed because that's not what motivates most decent engineers. But also, the pool of talent is so vast that they'd bankrupt the company with that pay roll. Oh and the non-compete situation in California means even if you do manage to hire someone, if they do have a good idea they're just going to quit and build it - safe with a nest egg you helped them build.

A common route for people is to join a big tech company for a few years, then quit and do a startup using the skills + cash gained...

Over the last few years, I’ve increasingly had to append site:reddit.com before any search query if I want some actual information.

Product reviews on Google are garbage, but everyone knows that already. What really disappointed me is searching for any slightly complex medical condition. Most of the top results are just repetitive, generic advice from “trusted” names like Webmd. Not helpful at all.

https://youtu.be/NT7_SxJ3oSI

The ending has the point

FWIW my WaySus 22 has been great

Nah, utter garbage :)

Never knew he had his own channel. His ScreenRant pitch meeting videos are gold

Nearly every negative google comment is downvoted

on HN this is usually the other way around

at least as far i can remember

Same, I’m surprised

The earnings threads always invert the usual "google sucks" narrative because when it comes to money google is objectively raking it in. People can form opinions about the company's product strategy or engineering capabilities or ethics or social implications but the earnings threads are usually "wow, they sure do make a lot of money."

It is just different topics.

This always happens when there's a popular post about big tech on HN. Google is a big company with lots of employees and lots of investors and HN is no longer a tiny corner of the internet. Just ignore the astroturfing and look for the signal in the noise.

If you poll consumers, Google is one of the most liked companies [0]. They don’t need to astroturf to get favorable comments.

Also, accusations of astroturfing are against the HN site guidelines. If you think comments are wrong, tell us why they are wrong, don’t attack the authors.

[0] https://morningconsult.com/most-loved-brands-2020/

I've had this debate with mods already. I believe there is astroturfing but I'm not going to waste my time pointing out every instance, especially since I actually did this a long time ago and it's almost impossible to prove. You're welcome to believe the entirety of the comments narrative is genuine. I disagree.

Like I said in my original comment, look for the signal in the noise. If you believe there is no noise then your search is already over.

Among three most downvoted comments, one comment is very (and likely intentionally) misleading and the rests are uninteresting, repetitive sarcasm which deteriorates the signal to noise ratio. This might be very surprising conclusion to some of ordinary HN audiences, but could there be any realistic possibilities of those comment deserving some downvotes?

HN is known to be anti google/big tech. So it’s odd to see the change

>HN is known to be anti google/big tech

Anti-Google / Big Tech is relatively new on HN. Especially the Anti-Google Part.

HN is well known to be Anti Facebook though. 2nd Place being Oracle.

I’ve been here since like 2008, it’s not new

And I have been here since 2008 ( this is my 2nd account ), I cant remember anyone was Anti Google when they released Chrome and were the media darling while I was the only few crying for Firefox.

The only hatred that existed since the birth of HN was Microsoft and Facebook. ( And Oracle )

Pardon my skepticism but your account is 7mo old?

Google: Total Rev: 70B, ads:57B, cloud 6B.

Amazon: Total rev: 116B Ads: 31B cloud:71B

It's reasonable to say that Google's biggest threat is Amazon's ad business. And instagrams not far behind.

Aren't Amazon ads just sellers prioritizing their listing on the Amazon page? Seems totally different from the ad market for Google

Aren't Google ads just businesses prioritizing their listings on Google search page?

Who will advertise a concert or any various services on Amazon? Or a restaurant? A conference?

Very niche focus for Amazon vs broader set of customers for Google ads. Seems totally different to me

Ecommerce sellers have higher margins (gross margin 40%) than the other services and businesses you mentioned. So they have more money to spend on Ads.

Also Google competes with FB and has to split the advertising pie for those other services and businesses. Amazon owns basically the whole pie for the people who want to advertise products.

E-commerce has terrible margins

Amazon itself had negative operating margins for its retail business last quarter.

Amazon retail: "Its U.S. segment recorded $206 million in operating losses, while the international side lost $1.63 billion."

Single digit margins at best, once a market is competitive.

Edit: You edited your above, but gross margin is meaningless. It doesn't even include salaries for employees or infrastructure costs. Net margins for retail will always be slim, outside of specific first mover advantage in some subsectors.

You think the Chinese companies selling $5 rubber spatulas are making 40% margins? Lol, try 5% or less.

The theory that Amazon retail would grow revenues rapidly and then eventually expand to high operating margins will never come to fruition. Margins will be below 10% in perpetuity

But sure, ignore all costs of running the business and look at gross margins.

A quick search says 40% gross margins for e-commerce. So Income - COGS. Which is pretty damn high. Most of these sellers are selling cheap Chinese goods so I bet it's even higher on Amazon.

And Amazon retail margins is way different and in no way comparable to SELLER margins.

Amazon loses money on every sale, yet somehow they are far pricier than ebay (which is profitable), and that is far pricier than aliexpress.

A quick sample of like-for-like products shows that typical sale+delivery price on amazon is 30% more than aliexpress and 18% more than ebay.

I really don't see how you can charge 30% more than a profit making competitor, sell in larger volume, yet make a loss.

Give it 5 years (3?) and they might just sell many of these. Concert tickets, restaurant bookings/take out aren't so hard to imagine.

I think Amazon's ambition is endless.

Many of my Amazon ads are for non products like financial services (specifically Amex)

No. They are ads all over the internet through AdSense.

Amazon has a pretty developed video and display advertising market for publishers called Unified Ad Marketplace; for our business, it's typically in second behind AdX/Adsense for revenue and impressions won. That said, I'm not seeing any revenue breakout from Amazon that specifies how much this side of the business makes.

Huh? Isn't the ecomm component of Amazon's "Total Rev" several hundred billion?

COGS is >70% of that number. Retailers typically subtract it before calculating gross margins.

Sure but we're talking revenue, not gross margins.

Amazon has PrimeVideo, BlueOrigin, Trucking Fleets etc... so diverse. What is google doing with all the cash its sitting on? Is Waymo their only bet? They definitely aren't innovating with youtube, 3rd rate copycat features like 'shorts' etc... poor livestreaming/chat design. Maybe they'll just end up buying rocketlab for their space project ...

https://www.vox.com/new-money/2017/4/19/15357290/juicero-400...

Blue Origin is not part of Amazon.

Ok technically yes, but their IP is probably shared.

For instance, Elon Musk has mentioned the Materials Science team he has works for all 3 companies Tesla,SpaceX,BoringCompany etc...

There are close Google <=> SpaceX links too... The Starlink backbone network uses Google Cloud features that appear custom built/aren't available even to big customers. Nearly all Tesla tech seems built on top of Google tech - for example they use various private maps API's for the in-car map display. And everything is built on top of protocol buffers, google's in-house RPC/serialization format.

Protocol buffers have been public for 10+ years (since 2008 according to Wikipedia). Given the mobility between tech companies, it's hardly surprising that the same ideas / solutions are reused across companies.

https://en.m.wikipedia.org/wiki/Alphabet_Inc#Structure

Went over the list of new (consumer facing) products from Google from the last decade that actually got somewhere and concluded that Google Cast and Chromebooks are close to the only one (I may have missed some, but there can't be many). Nothing that compares to Gmail, search, etc.

Additionally, their existing services are getting worse and worse. YouTube is a mess, requiring at least an ad-blocker, and preferably also an extension like Unhook[1] . Google search requires a site blocker to prevent ads and spam domains from dominating the results.

Instead of furthering the development of good products it appears that the culture is focusing on creating new products to get a promotion just to let it die before it gains momentum (see https://killedbygoogle.com/).

If Google is still part of the FAANG (or is it MAANG now) accronym at the end of the decade I'll eat my top hat (I don't have one but I'll buy one just for this).

[1]: https://unhook.app/

To be fair, it looks like Meta and Netflix are in a lot of trouble too.

Netflix has always been in trouble and has never been cashflow positive once they started making content. Problem is now we're in a recession and the free money has run out. Swimming naked when the tide goes out and all that...

Google has lacked product leadership since Sergey Brin and Larry Page left. Since the early-2010's Google has suffered enormous management bloat and exclusively taken a quarterly profit focus.

Always wondered why Larry and Sergey ran for the exits, I assume they had their kids threatened by a TLA and quietly cashed out. I assume it has something to do with the Snowden revelations that their inter-datacenter links were unencrypted on purpose.

They're spending it on feeding their engineers with free food and massages.

Your Amazon ads / AWS numbers look annual, the other numbers quarterly. Just what kind of conclusion are we supposed to draw from that?

I think you might be mixing quarterly and yearly numbers.

Amazon Ads 31B is an annual figure. Last quarter it was ~8B. Same thing with cloud; AWS pulled ~18B last quarter.

Amazon Ads is a legit threat to Google, especially with product searches. Instagram struggles to monetize commercial queries to the same degree as Goog/Amzn.

I think Google is more of a threat to Amazon than Amazon is a threat to Google.

Google Shopping and YouTube Shopping are going to eat away at Amazon being the go to place to do product searches.

Here are accurate numbers:

Google Q2: 70B, ads: 57B, cloud 6B. Net profit: $16B

Amazon Q1: 117B, ads: 8B, cloud 18B. Net profit: -$4B

OK - at 1am I should still do better data checking - apologies please ignore the whole thing

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