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Alphabet Becomes the Most Valuable Public Company in the World

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Re: Alphabet Becomes the Most Valuable Public Company in the World

#121

Post by stvswn »

jfuhrman wrote: post #109
jonknee wrote: post #47

Earlier quoted context omitted.

Why? It's obvious that is where they are going.

How much of Google's profit(or even revenue) is not from tracking user data and advertising? Search, Gmail, Android, Chromebooks, Nexus, Pixel, Youtube, Maps etc. everything is about selling advertisements after scanning user provided data. The rest are either loss leaders or moats, or ones with unclear monetization scenarios like Fiber. One exception is GCE and GAE, but I don't know how much profit/revenue they're m…

Your question is answered explicitly in the press release, if you wanted to Google it. But are you instead making a point about how that's bad or something? The business model is to give away services for free and then show ads to monetize, that's no secret. Do you contend this is a poor business model, or somehow immoral or something?

Re: Alphabet Becomes the Most Valuable Public Company in the World

#122

Post by skybrian »

mwfunk wrote: post #97
jonknee wrote: post #47

Earlier quoted context omitted.

Why? It's obvious that is where they are going.

Calling someone an "X company" means that they make their money from X. There are aspects of AI in targeted advertising, but not enough to call them an AI company rather than an advertising company. It doesn't really matter where they're going- that's what they aspire to be, not what they are. If you judge companies based on their aspirations, you end up judging them based on their most positive and idealistic versio…

The stock price of a company is based on predicting future earnings, so talking about the future of a company is pretty much unavoidable in this sort of discussion. You can ignore what management says and predict the future in some other way if you prefer, but ignoring the future entirely isn't possible. (Assuming that nothing will change is also a prediction.)

Re: Alphabet Becomes the Most Valuable Public Company in the World

#123

Post by dragonwriter »

mwfunk wrote: post #97
jonknee wrote: post #47

Earlier quoted context omitted.

Why? It's obvious that is where they are going.

Calling someone an "X company" means that they make their money from X. There are aspects of AI in targeted advertising, but not enough to call them an AI company rather than an advertising company. It doesn't really matter where they're going- that's what they aspire to be, not what they are. If you judge companies based on their aspirations, you end up judging them based on their most positive and idealistic versio…

> Calling someone an "X company" means that they make their money from X.

Sure, but even so (except for the way some people treat Google), we typically call companies that make their money by placing ads in a service or media offering an "X company" where X describes the service or media offering, not "advertising".

From that perspective, Google is an online services company, with AI playing an important role in some of its services.

Re: Alphabet Becomes the Most Valuable Public Company in the World

#124

Post by nl »

czhiddy wrote: post #111
newman314 wrote: post #69

People were losing their minds over the fact that iPhone shipments slightly declined. If you look at the year over year growth (excluding the massive bump for iPhone 6), it would show that AAPL is still ahead of the growth curve. See https://imgur.com/vO0kPEy * Apple's quarterly revenue: $75.9bil * Apple's quarterly profit: $18.4bil * Google's quarterly revenue: $21.3bil * Google's quarterly profit: $6.8bil In sheer…

If you add in the same comparison to Facebook's numbers, the valuations look even more puzzling (using the most recent quarter): * Apple's quarterly revenue: $75.9b * Apple's quarterly profit: $18.4b * Apple's market cap: $538.7b * Apple's P/E ratio: 10.24 * Google's quarterly revenue: $21.3b * Google's quarterly profit: $6.8b * Google's market cap: 517.6b (pre-earnings) * Google's P/E ratio: 35.37 (pre-earnings) * F…

Apple will always have a lower P/E because the costs associated with building and selling physical products is higher.

Facebook's financials are ~1/3 Google's and so is its P/E. It's a much younger company and seems possible that's it's revenue and profit could approach Google's.

I don't see anything unbelievable or even particularly unusual.

Re: Alphabet Becomes the Most Valuable Public Company in the World

#125

Post by magicalist »

mwfunk wrote: post #97
jonknee wrote: post #47

Earlier quoted context omitted.

Why? It's obvious that is where they are going.

Calling someone an "X company" means that they make their money from X. There are aspects of AI in targeted advertising, but not enough to call them an AI company rather than an advertising company. It doesn't really matter where they're going- that's what they aspire to be, not what they are. If you judge companies based on their aspirations, you end up judging them based on their most positive and idealistic versio…

> Calling someone an "X company" means that they make their money from X. There are aspects of AI in targeted advertising, but not enough to call them an AI company rather than an advertising company.

eh, either way Google is described it's just trying to be a cute soundbite with next to no information.

You can call them an advertising company, but they create the products that most of their ads are seen in, so really they're an advertising company and a software company. They build the data centers all that software runs on or comes from, so they're also a data center company. And if they're using AI in most of their products these days (no idea), you could fairly add AI company on there too.

So what is the X in "they're an X company"? A better question is why does it matter what the X is? You don't gain any insight by filling it in.

Instead we could go crazy and use like two, even three sentences to describe what a company does, what its incentives are and where its constrained.

Re: Alphabet Becomes the Most Valuable Public Company in the World

#126

Post by jfuhrman »

stvswn wrote: post #121
jfuhrman wrote: post #109

Earlier quoted context omitted.

How much of Google's profit(or even revenue) is not from tracking user data and advertising? Search, Gmail, Android, Chromebooks, Nexus, Pixel, Youtube, Maps etc. everything is about selling advertisements after scanning user provided data. The rest are either loss leaders or moats, or ones with unclear monetization scenarios like Fiber. One exception is GCE and GAE, but I don't know how much profit/revenue they're m…

Your question is answered explicitly in the press release, if you wanted to Google it. But are you instead making a point about how that's bad or something? The business model is to give away services for free and then show ads to monetize, that's no secret. Do you contend this is a poor business model, or somehow immoral or something?

If you follow the thread, it's about calling Google an AI company.

Re: Alphabet Becomes the Most Valuable Public Company in the World

#127

Post by Gustomaximus »

tyingq wrote: post #11

Paid clicks up 31% overall, on Google’s own sites, up 40%. That's a bit concerning to me, especially when you consider: a) That growth is outpacing internet traffic growth, and has for many years now. Internet traffic CAGR is 23%[1] b) The shift from desktop to mobile should have the effect of reducing clicks. c) Since some of the growth is video, I would expect a decrease in click growth related to this as well. Vid…

I would guess this is the ever increasing paid presence on the search screen. Take a look at a screenshot from 10 years ago. Today on a smaller screen you can't even see organic results. With some shopping and maps results you don't get much organic on a larger screen. I find it amazing this is not more discussed as losing value as organic search. As a marketer I see this often forces a company to often bid for their brand name searches as competitors will hog the screen if you don't. It will be interesting to see how it develops further but I can't see Google doing anything but owning search ongoing for the short to medium term.

Re: Alphabet Becomes the Most Valuable Public Company in the World

#128

Post by MCRed »

czhiddy wrote: post #111
newman314 wrote: post #69

People were losing their minds over the fact that iPhone shipments slightly declined. If you look at the year over year growth (excluding the massive bump for iPhone 6), it would show that AAPL is still ahead of the growth curve. See https://imgur.com/vO0kPEy * Apple's quarterly revenue: $75.9bil * Apple's quarterly profit: $18.4bil * Google's quarterly revenue: $21.3bil * Google's quarterly profit: $6.8bil In sheer…

If you add in the same comparison to Facebook's numbers, the valuations look even more puzzling (using the most recent quarter): * Apple's quarterly revenue: $75.9b * Apple's quarterly profit: $18.4b * Apple's market cap: $538.7b * Apple's P/E ratio: 10.24 * Google's quarterly revenue: $21.3b * Google's quarterly profit: $6.8b * Google's market cap: 517.6b (pre-earnings) * Google's P/E ratio: 35.37 (pre-earnings) * F…

Now do Amazon which is a retailer, often running at a loss on the retail side, with a nicely growing Hosting business... but even the margins on the hosting business don't justify Amazon's P/E ratio.

I don't think the market is efficient, it has a lot to do with perception. Amazon, for instance, is constantly doing press releases for products, even products that have no future (this is a deliberate strategy near as I can tell from my time when I worked at Amazon)... while Apple does 3 or 4 product introductions a year, and doesn't do a lot of PR stuff (Though Tim Cook is getting interviewed a lot more than Steve Jobs did.)

Re: Alphabet Becomes the Most Valuable Public Company in the World

#129

Post by jpatokal »

pinaceae wrote: post #100
npalli wrote: post #95

Earlier quoted context omitted.

70% of the revenue and (maybe) 80% of the profit of Apple comes from a single product - the iPhone. Apple themselves have given lower guidance going forward. There is a limit to the number of people buying iPhone at huge margins every year. The total units might continue to grow but not at the current margins and not as frequently. Hard to be bullish unless some other product takes off.

unlike Google, where practically 100% comes from one single product, which is ads. all "other bets" are actually losing money, per their data.

Nope: there's Google ads, Google non-ads, and "Other Bets". Q4 Google non-ad revenue was $2.1 billion, or almost 10%, and this share has been steadily increasing.

https://abc.xyz/investor/news/earnings/2015/Q4_google_earnin...

Re: Alphabet Becomes the Most Valuable Public Company in the World

#130

Post by lazaroclapp »

mrb wrote: post #108
newman314 wrote: post #69

People were losing their minds over the fact that iPhone shipments slightly declined. If you look at the year over year growth (excluding the massive bump for iPhone 6), it would show that AAPL is still ahead of the growth curve. See https://imgur.com/vO0kPEy * Apple's quarterly revenue: $75.9bil * Apple's quarterly profit: $18.4bil * Google's quarterly revenue: $21.3bil * Google's quarterly profit: $6.8bil In sheer…

Which pretty much shows that the market value of a company is not based on what they sell today, but on the expectation of what they will sell tomorrow. Does Apple do research in biotech (Alphabet's Calico)? Are they developing drones delivering wireless internet to the world (Google's Skybender)? Do they have an investment arm (Google Ventures)? Did they start an ISP (Google Fiber)? People see Alphabet's increasing…

Apple's brand trades a lot on having extremely well finished products with very polished experiences. If they started experimenting left and right like Google does, they would lose that brand image, which is arguably their most valuable asset (even above and beyond the technology itself). If Google releases Glass and it flops, it hardly affects their image ('well, yes, it's cool technology, that's what Google does, but I don't think people want it for now...'), if Apple does the same it would be thousands of articles about how Apple is losing its touch and can't possible survive without Steve Job's genius.

Maybe the only way around that is taking a page out of Alphabet's playbook and making a parent company with "riskier" subsidiaries with their own non-Apple brand?

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