Business Description

Alphabet, Inc., a holding company, is involved in the acquisition and operation of different companies. It is a holding company that operates in the Google and Other Bets sections. Its main Internet products include ads, Android, and Chrome. Access, Calico, and CapitalG are all part of the Other Bets segment. Verily, Waymo and Access are also included. Sergey Mikhaylovichbrin and Lawrence E. Page founded the company on October 2, 2015. It is located in Mountain View, CA.

Key Financials

Revenue (US$ Mn):

• Alphabet, Inc.’s annual revenue for 2021 was US$ 2,57,637 Mn, a 41.15% increase from the 2020
• The annual revenue generated by Alphabet, Inc. in 2020 was US$ 1,82,527 Mn
• At an 18.3% increase from , Alphabet, Inc.’s annual revenue of US$ 1,61,857 Mn was indexed in 2019
• Alphabet, Inc. generated total revenue of US$ 1,36,819 Mn in 2018

Operating Income(US$ Mn):

• US$ 78,714 Mn was the operating income generated by Alphabet, Inc. in 2021
• Alphabet, Inc.’s operating income for 2020 was US$ 41,224 Mn, a 14.74% increase from 2019
• From 2018’s operating incomes, Alphabet, Inc. registered a 14.45% increase in 2019, amounting to US$ 35,928 Mn
• An operating income of US$ 31,392 Mn was generated in 2018 by Alphabet, Inc.

Net Income(US$ Mn):

• Alphabet, Inc.’s net income for 2021 was US$ 76,033 Mn, an 88.81% increase from 2020
• The net income generated by Alphabet, Inc. in 2020 was US$ 40,269 Mn
• At an 11.74% increase from , Alphabet, Inc.’s net income of US$ 34,343 Mn was indexed in 2019
• Alphabet, Inc. generated a net income of US$ 30,736 Mn in 2018

Operating Margin % :

• Alphabet, Inc.’s operating margin for 2021 was 31%, a 37.17% increase from 2020
• The operating margin generated by Alphabet, Inc. in 2020 was 23%
• At a -3.06% decrease from , Alphabet, Inc.’s operating margin of 22% was indexed in 2019
• Alphabet, Inc. generated an operating margin of 23% in 2018

Gross Margin % :

• 54% was the gross margin generated by Alphabet, Inc. in 2021
• Alphabet, Inc.’s gross margin for 2020 was 54%, a -3.6% decrease from 2019
• From 2018’s gross margins, Alphabet, Inc. registered a -1.59% decrease in 2019, amounting to 56%
• A gross margin of 57% was generated in 2018 by Alphabet, Inc.

SWOT Analysis

Strengths

Revenue Growth

The company saw strong revenue growth in FY2020. This helps to gain investor confidence and increase its ability to provide adequate funds for future growth opportunities. Alphabet’s FY2020 revenue was US$182,527 million, compared to US$161,857 in FY2019. This represents an annual growth rate of 12.8% and a CAGR (continued growth rate) of 15.5% for 2018-2025.

Growth in revenue across all business segments was responsible for the increase in revenue, including sales of the Google Services segment by 11% and sales of the Google Cloud segment by 46%. Higher revenues from Google ads led to an increase in sales of Google Services segments.

The increase in Google Search & other, YouTube ads, and Google Network Members properties revenue drove growth in the Google advertising business. The continued strength of Google Workspace and GCP has contributed to an increase in Google Cloud revenue. Google Others increased due to an increase in revenue from Google Play and YouTube subscriptions, as well as other non-advertising revenues.

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