We first wrote about GOOGL with an admiring Initiating coverage type note on 5th May 2023. This note can be found here.
GOOGL has been a remarkable cash generating machine for 25 years and the huge advertising cash flow had been used to diversify the business. The deployment of this cash included acquisitions (including YouTube, DoubleClick and DeepMind), investment (most notably the Cloud business) and new projects or moonshots (such as Waymo and Verily). The excess cash has also been used to recruit heavily and pay employees generously.
In recent years, in addition to the dominant Search business, YouTube, Cloud and Subscriptions have become important sources of revenue.
One of the most impressive aspects of the company is its immense scale. Google has a number of products beyond Search (such as Chrome, Android, Gmail, Google Maps and Google Workspace) which are used by millions of people. As management noted in their earnings conference call a year ago.
“6 products with more than 2bn monthly users, 15 products have 50mn users, and we operate across 100 plus countries.”
They are now adding AI functionality to all these widely-used products.
Our previous reports on GOOGL can be found here, here and here.
The company recently reported its Q1 2025 results.
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