A massive move for Google as it goes through a corporate restructuring...but what does it all mean?
Well this is interesting.
Google made a surprise announcement on Monday...completely restructuring corporate.
They're forming an umbrella company called "Alphabet" and naming a new CEO to the core business of the Google giant.
Larry Page and Sergey Brin - the Google co-founders - will run Alphabet, Page as the CEO and Brin as President.
Sundar Pichai will take over as CEO of Google, an announcement made in Monday's blog post called "G is for Google".
What exactly does this all mean? Well to break it down, Alphabet will be the parent company. Under it will be Google, which will continue to focus on internet products such as Android, YouTube and Google search ads. Other departments will be spinning off into sub companies. Among them are research focused Life Sciences (including Google contact lenses), Calico (focused on increasing longevity), and the Google X lab (focused on drone delivery, driverless cars, Google glass and more).
From a liability perspective, it's a protective move. It will allow the stand-alone companies to take more risks and invest in experimental projects without interference from other parts of the company. It's also one that follows in the footsteps of Berkshire Hathaway.
Warren Buffett's enormous empire has a wide range of different businesses, encompassing everything from real estate to batteries.
Just last year, Page was quoted in The Financial Times saying that he aspired to be more like Buffett, managing a number of partially independent leaders all working under the same umbrella.
In the last quarter alone, Google posted $17.7 billion in sales. Where did 90% of it come from ? Advertising.
Thank you, search engine marketing buyers. You're Alphabet's biggest investor.
So as an investor...what are your thoughts on the move?
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