[ad_1]
Alphabet's mission is to be more than an advertising agency and is currently focused on three innovative ideas for this purpose: Wing, Waymo and Loon.
Just last week, Alphabet's self-proclaimed Waymo, announced the opening of a plant in Detroit to build standalone vehicles in anticipation of the broader roll-out of its mobile phone service. . its UAV delivery company, Wing, has received approval to start delivering products to the United States; and Loon, the Internet-Balloon company, announced a $ 125 million investment from SoftBank before launching a service in Kenya.
But the cost of creating this land weighs on the bottom line of Alphabet. Unlike Google's advertising, these three new companies use completely new materials. Waymo needs cars and storage facilities; The wing requires drones and chargers; and Loon needs balloons and a connectivity infrastructure.
Alphabet's operating losses for its other bets – the term used to list all of its start-up accounts and start-up activities – increased by almost $ 300 million in the first quarter of 2019 compared to the same period last year. the previous year, announced the company in its quarterly earnings today (April 29). Alphabet lost $ 868 million in the Other bets category during the quarter, compared to $ 571 million in the same quarter of 2018.
The losses in other bets is not abnormal for Alphabet: the company has long used its gigantic advertising activity to support his ideas that did not bring anything at the moment. Yet Wing, Waymo and Loon are about to embark on real customers. This means investing in more than just research and development, but also a host of new costs associated with marketing a product. Think about customer support, marketing, office space, human resources departments and almost every other capital expense you can think of.
Investors also did not find the rest of the benefits of Pink Alphabet. The company announced a slowdown in advertising sales, registering a sales increase of only 15% for the quarter, compared to 24% for the same period last year. And while the company generated $ 36.3 billion in total revenue in the quarter, its growth rate slowed to 17 percent from 28 percent a year earlier. Shares of the company plunged more than 7% to $ 1,203.00 after trading.
[ad_2]
Source link