Alphabet

The DOJ antitrust ruling finding Google an illegal monopolist in search is not a nothing-burger. Structural remedies are still on the table and a forced divestiture or default search agreement changes the entire revenue model — Search is still over 55% of total revenue.

Does anyone have a good breakdown of how much YouTube Shorts is actually cannibalizing long-form ad revenue versus growing the total pie? Management keeps citing Shorts monetization improving but the CPMs are structurally lower than traditional YouTube.

People forget that Google's TPU infrastructure gives them a genuine cost advantage in training and serving large models at scale compared to companies that have to buy Nvidia compute at spot prices. This is a multi-year structural moat that doesn't show up cleanly in any one metric.

Google DeepMind published results showing AlphaFold 3 can now predict the structure of DNA, RNA, and small molecules in addition to proteins, which significantly expands its utility in drug discovery workflows. Several major pharma companies are already licensing access through a commercial API.

Gemini's public perception took a real hit after the image generation controversy earlier this year and OpenAI has a massive mindshare lead with consumers. Google has the distribution but they've fumbled the brand execution on AI badly.

The interesting tension in Alphabet right now is that AI overviews in Search could actually reduce clicks to third-party sites, which means Google might be undermining the publisher ecosystem that makes search advertising valuable. It's a real structural question management hasn't answered clearly.

Waymo is doing over 100,000 paid robotaxi rides per week in San Francisco and LA combined, which is a staggering operational milestone that gets almost no attention relative to what it could mean. If they can crack the unit economics the TAM is enormous and it's sitting inside Alphabet.

It's worth noting that Google's ad tech stack — DV360, Campaign Manager, Google Ad Manager — is also under antitrust scrutiny in a separate DOJ case targeting the display advertising business specifically. The search case gets all the headlines but ad tech is a distinct and serious proceeding.

Operating expenses are still running hot — headcount reductions in early 2023 were largely offset by aggressive hiring in AI and Cloud, and capex guidance for 2024 is $48 billion plus, which is a level of spend that will pressure free cash flow even as revenue grows.

Alphabet confirmed it is acquiring cloud security startup Wiz for $32 billion, the largest acquisition in company history. The deal is intended to bolster Google Cloud's security posture and compete more directly with Microsoft's integrated security suite inside Azure.

Google Cloud crossed $12 billion in quarterly revenue and is finally pulling serious operating margin. The narrative that AWS and Azure would permanently squeeze them out is falling apart — enterprise deals are accelerating and they're winning on AI tooling, especially with Vertex AI integrations.

Has anyone modeled out what the financials look like if Google loses the Apple default search deal in whatever remedy the court imposes? I've seen estimates ranging from $15B to $20B in annual revenue impact but the range is huge.