Alphabet: an analysis of its Q4/FY2024 Results
Alphabet, the parent company of Google and YouTube, managed to increase its diluted EPS by 76% over the past two years.
Alphabet’s flagship, Google Search, which accounts for 56% of the company's total revenue, saw its revenue increase by 13.2% year-over-year (YoY) to $198 billion for FY2024.
Advertising revenue from YouTube grew by 14.7% YoY to over $36 billion. This means YouTube Ads contributed 10% to Alphabet’s total revenue. According to Nielsen data, YouTube ranks as the number one streaming platform in the United States. It holds an 11.1% market share in the overall TV market (including broadcast and cable), which is 2.6 percentage points higher than the second-largest streamer, Netflix (8.5%) (Nielsen, 2024).
Including Google Network, Alphabet relied on advertising revenue for 75.6% of its total revenue in FY2024. This total advertising base grew by 11.2% over the past fiscal year to approximately $265 billion.
The fastest-growing segment within Alphabet is Google Cloud. This division saw its revenue increase by 30.6% YoY to $43 billion. However, with a 12.3% contribution to total revenue, it remains a relatively small, although rapidly growing, part of the company.
Beyond Google and YouTube, Alphabet also owns Waymo and DeepMind. These companies fall under Alphabet’s Other Bets, which saw their revenue increase to $1.6 billion in FY2024 (FY2023: $1.5 billion). For now, these Other Bets contribute just 0.5% to Alphabet’s total revenue. Waymo facilitated 4 million rides last year and is now averaging 150,000 rides per week, according to Alphabet.
In total, Alphabet generated $350 billion in revenue last year, a 13.9% YoY increase compared to FY2023 ($307 billion).
What do you think of Alphabet for the coming 10 years, will it be a good investment?
Read the full analysis of Alphabet's Q4/FY2024 on our Substack/LinkedIn-page
@massivemoats
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