Google’s parent company Alphabet said that mobile search and video are powering growth in its core advertising business, with finance chief Ruth Porat stating that it is “excited about the progress of newer businesses” across the group.
Google chief Sundar Pichai reflected that the company’s recent quarter has been one of its busiest ever, with the introduction of Google Assistant, its new Pixel devices, and Allo and Duo apps. And he said the transition to “experience computing more naturally and seamlessly” will be as significant as the shift from desktops to mobile.
But in the meantime, he said that its advertising business is “thriving in a mobile world”.
“Our mobile properties like Search, YouTube, Maps, and Google Play are where people turn when they are actively interested in something,” he said.
The company reported a profit of $5.1 billion, up 27 per cent from $4 billion, on revenue of $22.5 billion, up 20 per cent from $18.7 billion.
Obviously this was driven by the Google business, rather than the less mature ‘other bets’ investments.
Operating income for Google increased 16.7 per cent to $6.8 billion, on revenue up 20 per cent to $22.3 billion.
Other bets division
Operating loss for other bets decreased to $865 million from $980 million, on revenue of $197 million, up 39.7 per cent.
Porat noted that other bets quarterly performance can be “lumpy”, reflecting that these are early-stage businesses, represent an aggregation of businesses at different stages of growth, and can be affected by one-time costs such as partnership deals.
She said that at Nest, product developments are leading to increased consumer adoption of its home products. And for self-driving cars, its test fleet has passed 2 million miles of autonomous driving, and it is now working in four cities to experience “varied weather and driving conditions”.
Google Fiber pause
Earlier this week, changes were announced to the Google Fiber rollout plans. Craig Barratt, SVP of Alphabet and CEO of the Access unit, said that while work will continue where it has begun (12 cities), for the eight potential markets where it has been in exploratory discussions, “we’re going to pause our operations and offices”.
“We’re confident we’ll have an opportunity to resume our partnership discussions once we’ve advanced our technologies and solutions.”
This will be accompanied by job cuts, and Barratt is also stepping down from his role (although he will continue as an advisor).
This is not the first time changes at Google Fiber have been reported, as it failed to meet forecast subscriber numbers. The business is also looking at options for wireless technology to ease its path.