Google spent $2.1 billion on severance and different bills because it laid off greater than 12,000 staff over the course of 2023. And the layoff costs maintain coming: in simply the one month of 2024 up to now, the corporate has already spent $700 million on worker severance costs as a part of layoffs concentrating on another 1,000-plus roles. Alphabet, Google’s mum or dad firm, revealed the determine alongside its fourth-quarter earnings launch on Tuesday.
Regardless of the cuts, Google ended 2023 with development throughout most of its core enterprise traces. Google posted $86 billion in income for the fourth quarter of 2023, a 13 p.c improve 12 months over 12 months. The search large’s core digital adverts and cloud computing companies additionally confirmed regular development, which CEO Sundar Pichai credited to Google’s investments in generative AI.
Closing down workplaces value Google, too
Google’s main income generator, its search engine enterprise, generated $48 billion, a virtually 13 p.c soar 12 months over 12 months. The corporate’s subscription companies and units phase generated $10.7 billion, thanks primarily to subscriptions to YouTube Premium and Music, YouTube TV, and Google One, in keeping with Pichai. YouTube’s promoting income was $9.2 billion, a 15 p.c spike from final 12 months.
On a name with traders, Pichai referred to 2024 as Alphabet’s “Gemini period,” referring to the corporate’s AI language mannequin that it expects to work throughout all of Google’s core merchandise. “Gemini is the primary realization of the imaginative and prescient we had once we fashioned Google DeepMind, bringing collectively our two world-class analysis groups,” Pichai stated. Coming across the bend is Gemini Extremely, an replace of the unique mannequin which the corporate continues to be engaged on. “Gemini Extremely is coming quickly. The group is already engaged on the subsequent model and bringing it to our merchandise, beginning with Search.”
Google is at present the third-largest cloud supplier on the earth, trailing behind Microsoft’s Azure and AWS. However the cloud division picked up steam final 12 months. The corporate reported $9.19 billion in income for Google Cloud, a substantial increase of 25.6 p.c 12 months over 12 months.
Though layoffs value Google a reasonably penny, so did the real estate cutbacks as a result of stated layoffs (together with in places just like the expensive Bay Space). Shutting down bodily workplace house value Google a complete of $1.8 billion for everything of 2023.
And Google’s continued investments in AI, or its “Gemini period,” signifies that even more layoffs are to observe in 2024 as the corporate makes cuts in different divisions to compensate.
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