Alphabet: The Bets Are Losing Less
February 1, 2017
I read “Alphabet’s Bets Beyond Search Are Starting to Pay Off.” Nothing like a story which uses the name of this blog. The main point is that the Alphabet Google thing continues to make money from online advertising. This particular discussion of Alphabet’s financials included this stat3ement:
In the fourth quarter, Alphabet’s other bets recorded $262 million in revenue, a healthy jump from $150 million in the fourth quarter a year ago. But more importantly, the company’s losses in the division shrank from the previous year, from $1.2 billion in Q4 2015 to around $1.1 billion in the fourth quarter this year. Google’s other bets consists of products like Nest, and while this represents a tiny fraction of Google’s overall business, it’s important because it represents a lot of the market Google envisions itself occupying in the years to come — and it’s equally important to see strong performance in that category.
These moon shots and bets are among the best funded start ups in history. For more than 15 years the company has been saddled with Steve Ballmer’s “one trick pony” observation. Reducing loses of $100 million is a positive step forward. There is that loss of $1.1 billion, however.
The “beyond search” plays have, in our view, not moved too far from online advertising.
Stephen E Arnold, February 1, 2017
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