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Dec 31, 2022
Alphabet Q4 2022 Earnings Report
Announced Q4 and Fiscal Year 2022 results, with revenue up 1% year over year and a focus on cost structure improvements.
Key Takeaways
Alphabet Inc. reported Q4 2022 consolidated revenues of $76.048 billion, a 1% increase year-over-year, and net income of $13.624 billion. The company is focusing on re-engineering its cost structure and investing in AI to drive future growth.
Q4 consolidated revenues were $76.048 billion, up 1% year over year, or up 7% in constant currency.
Full year 2022 revenues were $282.836 billion, up 10%, or up 14% in constant currency.
The company is working to improve all aspects of its cost structure to support investments in high-growth priorities.
A workforce reduction of approximately 12,000 roles was announced in January 2023.
Alphabet
Alphabet
Alphabet Revenue by Segment
Alphabet Revenue by Geographic Location
Revenue by Segment
Google Services Revenue
CapyFin.comGoogle Cloud Revenue
CapyFin.comOther Bets Revenue
CapyFin.comRevenue by Geographic Location
United States Revenue
CapyFin.comEMEA Revenue
CapyFin.comAPAC Revenue
CapyFin.comOther Americas Revenue
CapyFin.com Forward Guidance
Alphabet anticipates incurring charges related to workforce reduction and office space optimization in Q1 2023. A change in the estimated useful life of servers and network equipment to six years is expected to reduce depreciation by approximately $3.4 billion for the full fiscal year 2023.
Positive Outlook
- Expected reduction of depreciation by approximately $3.4 billion for the full fiscal year 2023 due to change in useful lives of servers and network equipment.
- Focus on AI is expected to drive innovation and growth across Google Services, Google Cloud, and Other Bets.
- The company is actively working to improve its cost structure to support investments in high-growth areas.
- Strong momentum in Cloud, YouTube subscriptions, and Pixel devices.
- Long-term investments in deep computer science position the company well as AI reaches an inflection point.
Challenges Ahead
- Anticipated employee severance and related charges of $1.9 billion to $2.3 billion in Q1 2023 due to workforce reduction.
- Expected exit costs of approximately $0.5 billion in Q1 2023 related to office space reductions.
- Potential for additional charges in the future as the company further evaluates its real estate needs.
- Fluctuations in the value of investments may contribute to the volatility of other income and expenses in future periods.
- Workforce reduction of approximately 12,000 roles announced in January 2023.
Revenue & Expenses
Visualization of income flow from segment revenue to net income