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Alphabet Third Quarter 2021 Results [pdf]

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Re: Alphabet Third Quarter 2021 Results [pdf]

#101

Post by klelatti »

theevilsharpie wrote: post #62
caturopath wrote: post #53

Earlier quoted context omitted.

It's not quite half a percent by most accounts of GWP, but it's around there.

0.5% of global GDP would be more reasonable, although a fraction is an odd way of writing it. It also doesn't tell us much other than Google and Facebook are large companies with significant earnings. You can probably provide a similar percentage for VW/Toyota, Boeing/Airbus, Walmart/Amazon, or any other pair of large companies that are the leaders in their respective markets. Indeed, if you lumped the entire Fortune…

1/2 = 0.5 last time I checked but if you find 0.5 more reasonable that's fine.

Seriously though, Wal-Mart has $500 billion revenues but it's not growing at the rate of these companies. By lots of metrics these companies are increasingly globally significant in a way that most of the examples you quote aren't.

Re: Alphabet Third Quarter 2021 Results [pdf]

#102

Post by jeswin »

HWR_14 wrote: post #48

Once more, I don't understand how advertising revenue keeps growing. Once people install ad blockers, they don't typically remove them. And ad-blockers keep growing. So who is actually seeing these ads? How can those numbers be going up ? I understand, intellectually, that not everyone thinks like me. But I don't fundamentally understand why people allow ads on their devices when they can prevent it. Then again, I do…

Search ads and Youtube ads are unaffected by ad-blockers, and that's a big chunk of their revenue.

Re: Alphabet Third Quarter 2021 Results [pdf]

#103

Post by dragonwriter »

gitfan86 wrote: post #100
dragonwriter wrote: post #71

Earlier quoted context omitted.

> If there were 100 good search engines the price for advertising would be 90% lower If there were 100 good search engines for end users, but opinions of different users on quality were highly correlated, the traffic would be very disproportionately on the one that was perceived as even very slightly better. And they’d make the bulk of the advertising dollars. And they’d have the bulk of the money to throw at improve…

You are describing 99 shitty search engines and 1 good one.

Sure, if “slighty worse that good” is “shitty”.

When you can’t sell your slightly-less-good product for a lower price to make it value-competitive to slightly-more-good one, there’s very little reason for all the users not to go to the slightly-more-good one. With free services given away to get an advertising audience, that makes slight advantages very prone to positive feedback loops.

Re: Alphabet Third Quarter 2021 Results [pdf]

#104

Post by Jensson »

mrep wrote: post #35
TrainedMonkey wrote: post #29

Earlier quoted context omitted.

Looking at https://www.investopedia.com/government-stimulus-efforts-to-... and roughly guesstimating $1.5T from direct loans / PPP and additional $0.5T from the knock off stimulus and inflation effects.

That's money given to people and businesses. Secondary effects could go into the stock market but not directly and I definitely would not call that dumping into the stock market considering most was probably used to keep business and people afloat.

In a trickle up economy it doesn't matter where you drop it, it will go into the stock market.

Re: Alphabet Third Quarter 2021 Results [pdf]

#107

Post by gitfan86 »

jsnell wrote: post #40
gitfan86 wrote: post #30

Earlier quoted context omitted.

markets and moats matter. Anyone can get revenue selling tomatoes, the problem with tomato farming is that there is no moat, you will not be able to sell at a price much higher than the next farmer down the street. If there were 100 good search engines the price for advertising would be 90% lower

> If there were 100 good search engines the price for advertising would be 90% lower Why do you think that? The revenue is determined by the number of searches showing ads, the click-through rate, and the cost per click. The total across all companies would clearly not change for the first two metrics. Would the cost per click change? Given it's determined by an auction, I don't see how it could change. If you have a…

If competition existed company A would offer a better product than just cost-per-click. Then company B would offer another product better than company A, and so on. Google is like a person that owns the only road between two towns. You have to pay them until other people can build ferries or airports or trains. At which point you can exit the mentality of "we have to take this road and pay per drive"

Re: Alphabet Third Quarter 2021 Results [pdf]

#108

Post by Jensson »

gmiller123456 wrote: post #82
TameAntelope wrote: post #46

Earlier quoted context omitted.

Considering the world would be more than 0.5% worse without Google, I guess they're still undervalued?

You're making the assumption that no company, or companies, would step in and provide a similar service for a similar or better value.

Bing search, edge browser and windows phones? Amazon owning youtube? Companies would step up, but not sure if that would be a better scenario than what we have now.

Re: Alphabet Third Quarter 2021 Results [pdf]

#109

Post by ChuckMcM »

gradys wrote: post #73
ChuckMcM wrote: post #41

Earlier quoted context omitted.

No, computers typically have a service life of 5 years, but depreciating them faster gives you more loss to to write down against your income. What you are seeing though is the trick they used to make 'net income' pop. Let's say they had a million servers and a server costs $5K each. When depreciated at 3 years that is $1.6 billion dollars a year of depreciation. But you stretch that out to 4 years and now its only $…

> Since depreciation is subtracted from revenue you just "bumped" up your revenue by ... No, you bumped your net income. Revenue is unaffected by the depreciation change. Revenue is up 61%. Also, nobody would be fooled by an accounting trick like this. Analysts routinely compute EBITA, earnings before interest, taxes, and depreciation, exactly for this reason - filtering out the more purely financial/virtual expenses…

Fair, it bumps net income not revenue.

When I was younger, I took an accounting class from Santa Clara University (it was part of their Executive MBA program although I did not get an MBA) because I knew that I'd like to start my own company some day and needed to know how accounting worked.

> Also, nobody would be fooled by an accounting trick like this.

The course specifically covered "accounting tricks" that would create the most favorable impression in the eyes of the public and in the eyes of the analyst community. Playing around with depreciation rates was one of them. The assertion in class (which I've never had a chance to test) was that the IRS rarely, if ever, cared about your depreciation tables. That was damn close to 20 years ago so it most certainly could be different now, and I am not a tax accountant. If it has changed since then I am sure someone who has taken the class will correct me.

I don't think it "fools" analysts, but I suspect they might trade on an understanding that retail investors might have a different take on what was reported than what the analysts read.

Re: Alphabet Third Quarter 2021 Results [pdf]

#110

Post by harmmonica »

mrep wrote: post #35
TrainedMonkey wrote: post #29

Earlier quoted context omitted.

Looking at https://www.investopedia.com/government-stimulus-efforts-to-... and roughly guesstimating $1.5T from direct loans / PPP and additional $0.5T from the knock off stimulus and inflation effects.

That's money given to people and businesses. Secondary effects could go into the stock market but not directly and I definitely would not call that dumping into the stock market considering most was probably used to keep business and people afloat.

This squarely falls into the anecdotal camp, but my understanding based on online commentary and more specifically the actual experiences of four of my friends who run businesses ranging from a two-employee, furniture-building firm that probably generates $300-$500k in annual revenue all the way up to a major concrete contractor with a thousand employees and hundreds of millions in revenue applied for and were granted government funds and not a single one of those companies needed the money to keep staff on the payroll because their businesses continued to operate as normal for the extent of the pandemic. At least one of those folks fully admitted to putting their entire $80k+ "loan" into the stock market (the cruise lines in particular when they were getting beat up early on). It's appalling. And yes I said friends. I'm not condoning it, but business people will justify by saying "that's why I pay taxes."

I can't prove the scale, but I believe the op (or was it gp?) is right and those funds, to some extent, went directly into stocks, real estate, luxury automobiles, luxury watches, artwork and other assets, and a large percentage of the remainder found its way to those same places indirectly.

I have no concrete evidence or source for this, but I don't think my friends are unique here. For as many businesses as you heard were struggling there were countless others doing ok or even well during the pandemic.

Just trying to offer a different perspective on your comment.

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