Alphabet Announces First Quarter 2024 Results

MOUNTAIN VIEW, Calif. – April 25, 2024 – Alphabet Inc. (NASDAQ: GOOG, GOOGL) today announced financial
results for the quarter ended March 31, 2024.
Sundar Pichai, CEO, said: “Our results in the first quarter reflect strong performance from Search, YouTube and
Cloud. We are well under way with our Gemini era and there’s great momentum across the company. Our
leadership in AI research and infrastructure, and our global product footprint, position us well for the next wave of AI
innovation.”
Ruth Porat, President and Chief Investment Officer; CFO said: “Our strong financial results for the first quarter
reflect revenue strength across the company and ongoing efforts to durably reengineer our cost base. We delivered
revenues of $80.5 billion, up 15% year-on-year, and operating margin expansion.”

Q1 2024 Financial Highlights (unaudited)

The following table summarizes our consolidated financial results for the quarters ended March 31, 2023 and 2024
(in millions, except for per share information and percentages).

Quarter Ended March 31,

2023 2024
(unaudited)
Revenues $ 69,787 $ 80,539
Change in revenues year over year 3% 15 %
Change in constant currency revenues year over year(1) 6% 16 %

Operating income $ 17,415 $ 25,472

Operating margin 25 % 32 %

Other income (expense), net $ 790 $ 2,843

Net income $ 15,051 $ 23,662

Diluted EPS $ 1.17 $ 1.89
(1)
Non-GAAP measure. See the section captioned “Reconciliation from GAAP Revenues to Non-GAAP Constant Currency
Revenues and GAAP Percentage Change in Revenues to Non-GAAP Percentage Change in Constant Currency
Revenues” for more details.
Q1 2024 Supplemental Information (in millions, except for number of employees; unaudited)

Revenues, Traffic Acquisition Costs (TAC), and Number of Employees

Quarter Ended March 31,

2023 2024
Google Search & other $ 40,359 $ 46,156
YouTube ads 6,693 8,090
Google Network 7,496 7,413
Google advertising 54,548 61,659
Google subscriptions, platforms, and devices 7,413 8,739
Google Services total 61,961 70,398
Google Cloud 7,454 9,574
Other Bets 288 495
Hedging gains (losses) 84 72
Total revenues $ 69,787 $ 80,539

Total TAC $ 11,721 $ 12,946

Number of employees 190,711 180,895

Segment Operating Results

As announced on April 18, 2024, we are consolidating teams that focus on building artificial intelligence (AI) models
across Google Research and Google DeepMind to further accelerate our progress in AI. AI model development
teams previously under Google Research in our Google Services segment will be included as part of Google
DeepMind, reported within Alphabet-level activities, prospectively beginning in the second quarter of 2024.

Quarter Ended March 31,

2023 2024
Operating income (loss):
Google Services $ 21,737 $ 27,897
Google Cloud 191 $ 900
Other Bets (1,225) $ (1,020)
Alphabet-level activities(1) (3,288) $ (2,305)
Total income from operations $ 17,415 $ 25,472
(1)
In addition to the costs included in Alphabet-level activities, hedging gains (losses) related to revenue were $84 million and
$72 million for the three months ended March 31, 2023 and 2024, respectively. For the three months ended March 31,
2023 and 2024, Alphabet-level activities included substantially all of the charges related to employee severance and our
office space optimization efforts.

Additional Information Relating to the Quarter Ended March 31, 2024 (unaudited)

Dividend Program
Alphabet’s Board of Directors today approved the initiation of a cash dividend program, and declared a cash
dividend of $0.20 per share that will be paid on June 17, 2024, to stockholders of record as of June 10, 2024, on
each of the company’s Class A, Class B, and Class C shares. The company intends to pay quarterly cash dividends
in the future, subject to review and approval by the company’s Board of Directors in its sole discretion.
Stock Repurchases
Alphabet’s Board of Directors today authorized the company to repurchase up to an additional $70.0 billion of its
Class A and Class C shares in a manner deemed in the best interest of the company and its stockholders, taking
into account the economic cost and prevailing market conditions, including the relative trading prices and volumes
of the Class A and Class C shares. The repurchases are expected to be executed from time to time, subject to

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general business and market conditions and other investment opportunities, through open market purchases or
privately negotiated transactions, including through Rule 10b5-1 plans.

Employee Severance and Related Charges

Compensation expenses included employee severance and related charges for the three months ended March 31,
2024 of $716 million, a $1.3 billion decrease in severance and related charges as compared to the three months
ended March 31, 2023. For the first quarter of 2024, these charges are included within cost of revenues, research
and development, sales and marketing, and general and administrative expenses in the amounts of $153 million,
$247 million, $217 million, and $99 million, respectively. For additional information about the effect of these charges
in each period, see the section captioned “Reconciliation from Certain GAAP Measures to Certain Non-GAAP
Measures, Excluding the Effect of Severance and Related and Office Space Charges” below.

Webcast and Conference Call Information

A live audio webcast of our first quarter 2024 earnings release call will be available on YouTube at https://
www.youtube.com/watch?v=A2O2f5dlzcE. The call begins today at 1:30 PM (PT) / 4:30 PM (ET). This press
release, including the reconciliations of certain non-GAAP measures to their nearest comparable GAAP measures,
is also available at http://abc.xyz/investor.
We also provide announcements regarding our financial performance, including SEC filings, investor events, press
and earnings releases, and blogs, on our investor relations website (http://abc.xyz/investor).
We also share Google news and product updates on Google’s Keyword blog at https://www.blog.google/, which may
be of interest or material to our investors.

Forward-Looking Statements
This press release may contain forward-looking statements that involve risks and uncertainties. Actual results may
differ materially from the results predicted, and reported results should not be considered as an indication of future
performance. The potential risks and uncertainties that could cause actual results to differ from the results predicted
include, among others, those risks and uncertainties included under the captions “Risk Factors” and “Management’s
Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for
the year ended December 31, 2023, which are on file with the SEC and are available on our investor relations
website at http://abc.xyz/investor and on the SEC website at www.sec.gov. Additional information will also be set
forth in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2024, and may be set forth in other
reports and filings we make with the SEC. All information provided in this release and in the attachments is as of
April 25, 2024. Undue reliance should not be placed on the forward-looking statements in this press release, which
are based on information available to us on the date hereof. We undertake no duty to update this information unless
required by law.

About Non-GAAP Financial Measures

To supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP,
we use the following non-GAAP financial measures: free cash flow; constant currency revenues; and percentage
change in constant currency revenues, and other cost of sales, operating expenses, and operating margin,
excluding the effect of severance and related and office space charges. The presentation of this financial
information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information
prepared and presented in accordance with GAAP.
We use these non-GAAP financial measures for financial and operational decision-making and as a means to
evaluate period-to-period comparisons. We believe that these non-GAAP financial measures provide meaningful
supplemental information regarding our performance and liquidity by excluding certain items that may not be
indicative of our recurring core business operating results, such as our revenues excluding the effect of foreign
exchange rate movements and hedging activities, which are recognized at the consolidated level. We believe that
both management and investors benefit from referring to these non-GAAP financial measures in assessing our
performance and when planning, forecasting, and analyzing future periods. These non-GAAP financial measures
also facilitate management’s internal comparisons to our historical performance and liquidity as well as comparisons
to our competitors’ operating results. We believe these non-GAAP financial measures are useful to investors both
because (1) they allow for greater transparency with respect to key metrics used by management in its financial and
operational decision-making and (2) they are used by our institutional investors and the analyst community to help
them analyze the health of our business.

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There are a number of limitations related to the use of non-GAAP financial measures. We compensate for these
limitations by providing specific information regarding the GAAP amounts excluded from these non-GAAP financial
measures and evaluating these non-GAAP financial measures together with their relevant financial measures in
accordance with GAAP.
For more information on these non-GAAP financial measures, please see the sections captioned “Reconciliation
from GAAP Net Cash Provided by Operating Activities to Non-GAAP Free Cash Flow”, “Reconciliation from GAAP
Revenues to Non-GAAP Constant Currency Revenues and GAAP Percentage Change in Revenues to Non-GAAP
Percentage Change in Constant Currency Revenues” and “Reconciliation from Certain GAAP Measures to Certain
Non-GAAP Measures, Excluding the Effect of Severance and Related and Office Space Charges” included at the
end of this release.

Contact

Investor relations Media

[email protected] [email protected]

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 Alphabet Inc.
CONSOLIDATED BALANCE SHEETS
(In millions, except par value per share amounts)

As of December 31, As of March 31,

2023 2024
(unaudited)
Assets
Current assets:
Cash and cash equivalents $ 24,048 $ 24,493
Marketable securities 86,868 83,597
Total cash, cash equivalents, and marketable securities 110,916 108,090
Accounts receivable, net 47,964 44,552
Other current assets 12,650 12,829
Total current assets 171,530 165,471
Non-marketable securities 31,008 33,994
Deferred income taxes 12,169 11,687
Property and equipment, net 134,345 143,182
Operating lease assets 14,091 13,768
Goodwill 29,198 29,183
Other non-current assets 10,051 10,065
Total assets $ 402,392 $ 407,350
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable $ 7,493 $ 6,198
Accrued compensation and benefits 15,140 9,703
Accrued expenses and other current liabilities 46,168 48,603
Accrued revenue share 8,876 8,520
Deferred revenue 4,137 3,973
Total current liabilities 81,814 76,997
Long-term debt 13,253 13,228
Deferred revenue, non-current 911 921
Income taxes payable, non-current 8,474 9,234
Deferred income taxes 485 486
Operating lease liabilities 12,460 11,957
Other long-term liabilities 1,616 1,683
Total liabilities 119,013 114,506
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.001 par value per share, 100 shares authorized; no shares
issued and outstanding 0 0
Class A, Class B, and Class C stock and additional paid-in capital, $0.001 par value
per share: 300,000 shares authorized (Class A 180,000, Class B 60,000, Class C
60,000); 12,460 (Class A 5,899, Class B 870, Class C 5,691) and 12,381 (Class A
5,879, Class B 867, Class C 5,635) shares issued and outstanding 76,534 77,913
Accumulated other comprehensive income (loss) (4,402) (4,839)
Retained earnings 211,247 219,770
Total stockholders’ equity 283,379 292,844
Total liabilities and stockholders’ equity $ 402,392 $ 407,350

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 Alphabet Inc.
CONSOLIDATED STATEMENTS OF INCOME
(In millions, except per share amounts, unaudited)

Quarter Ended March 31,

2023 2024
Revenues $ 69,787 $ 80,539
Costs and expenses:
Cost of revenues 30,612 33,712
Research and development 11,468 11,903
Sales and marketing 6,533 6,426
General and administrative 3,759 3,026
Total costs and expenses 52,372 55,067
Income from operations 17,415 25,472
Other income (expense), net 790 2,843
Income before income taxes 18,205 28,315
Provision for income taxes 3,154 4,653
Net income $ 15,051 $ 23,662

Basic earnings per share of Class A, Class B, and Class C stock $ 1.18 $ 1.91
Diluted earnings per share of Class A, Class B, and Class C stock $ 1.17 $ 1.89
Number of shares used in basic earnings per share calculation 12,781 12,415
Number of shares used in diluted earnings per share calculation 12,823 12,527

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 Alphabet Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions, unaudited)

Quarter Ended March 31,

2023 2024
Operating activities
Net income $ 15,051 $ 23,662
Adjustments:
Depreciation of property and equipment 2,635 3,413
Stock-based compensation expense 5,284 5,264
Deferred income taxes (1,854) 419
Loss (gain) on debt and equity securities, net (84) (1,781)
Other 1,104 334
Changes in assets and liabilities, net of effects of acquisitions:
Accounts receivable, net 4,454 3,167
Income taxes, net 4,069 3,011
Other assets (746) (1,000)
Accounts payable (1,105) (2,124)
Accrued expenses and other liabilities (4,496) (5,054)
Accrued revenue share (602) (322)
Deferred revenue (201) (141)
Net cash provided by operating activities 23,509 28,848
Investing activities
Purchases of property and equipment (6,289) (12,012)
Purchases of marketable securities (14,227) (20,684)
Maturities and sales of marketable securities 18,327 24,985
Purchases of non-marketable securities (626) (1,206)
Maturities and sales of non-marketable securities 36 313
Acquisitions, net of cash acquired, and purchases of intangible assets (42) (61)
Other investing activities (125) 101
Net cash used in investing activities (2,946) (8,564)
Financing activities
Net payments related to stock-based award activities (1,989) (2,929)
Repurchases of stock (14,557) (15,696)
Proceeds from issuance of debt, net of costs 6,927 1,982
Repayments of debt (6,952) (3,079)
Proceeds from sale of interest in consolidated entities, net 3 8
Net cash used in financing activities (16,568) (19,714)
Effect of exchange rate changes on cash and cash equivalents 50 (125)
Net increase (decrease) in cash and cash equivalents 4,045 445
Cash and cash equivalents at beginning of period 21,879 24,048
Cash and cash equivalents at end of period $ 25,924 $ 24,493

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Segment Results
The following table presents our segment revenues and operating income (loss) (in millions; unaudited):

Quarter Ended March 31,

2023 2024
Revenues:
Google Services $ 61,961 $ 70,398
Google Cloud 7,454 9,574
Other Bets 288 495
Hedging gains (losses) 84 72
Total revenues $ 69,787 $ 80,539
Operating income (loss):
Google Services $ 21,737 $ 27,897
Google Cloud 191 $ 900
Other Bets (1,225) $ (1,020)
Alphabet-level activities (3,288) $ (2,305)
Total income from operations $ 17,415 $ 25,472

We report our segment results as Google Services, Google Cloud, and Other Bets:
• Google Services includes products and services such as ads, Android, Chrome, devices, Google Maps,
Google Play, Search, and YouTube. Google Services generates revenues primarily from advertising; fees
received for consumer subscription-based products such as YouTube TV, YouTube Music and Premium,
and NFL Sunday Ticket, as well as Google One; the sale of apps and in-app purchases and devices.
• Google Cloud includes infrastructure and platform services, collaboration tools, and other services for
enterprise customers. Google Cloud generates revenues primarily from consumption-based fees and
subscriptions received for Google Cloud Platform services, Google Workspace communication and
collaboration tools, and other enterprise services.
• Other Bets is a combination of multiple operating segments that are not individually material. Revenues
from Other Bets are generated primarily from the sale of healthcare-related services and internet services.
Certain costs are not allocated to our segments because they represent Alphabet-level activities. These costs
primarily include AI-focused shared R&D activities, including development costs of our general AI models; corporate
initiatives such as our philanthropic activities; corporate shared costs such as certain finance, human resource, and
legal costs, including certain fines and settlements. Charges associated with employee severance and office space
reductions during 2023 and employee severance in the first quarter of 2024, were not allocated to our segments.
Additionally, hedging gains (losses) related to revenue are not allocated to our segments.

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Other Income (Expense), Net
The following table presents our other income (expense), net (in millions; unaudited):

Quarter Ended March 31,

2023 2024
Interest income $ 797 $ 1,061
Interest expense (80) (94)
Foreign currency exchange gain (loss), net (210) (238)
Gain (loss) on debt securities, net (293) (462)
Gain (loss) on equity securities, net(1) 377 2,243
Performance fees 118 104
Income (loss) and impairment from equity method investments, net (51) (26)
Other 132 255
Other income (expense), net $ 790 $ 2,843
(1)
Includes all gains and losses, unrealized and realized, on equity securities. For Q1 2024, the net effect of the gain on equity
securities of $2.2 billion and the $104 million reversal of previously accrued performance fees related to certain
investments increased the provision for income tax, net income, and diluted EPS by $493 million, $1.9 billion, and $0.15,
respectively. Fluctuations in the value of our investments may be affected by market dynamics and other factors and could
significantly contribute to the volatility of OI&E in future periods.
Reconciliation from GAAP Net Cash Provided by Operating Activities to Non-GAAP Free Cash Flow (in
millions; unaudited):
We provide non-GAAP free cash flow because it is a liquidity measure that provides useful information to
management and investors about the amount of cash generated by the business that can be used for strategic
opportunities, including investing in our business and acquisitions, and to strengthen our balance sheet.

Quarter Ended
March 31, 2024
Net cash provided by operating activities $ 28,848
Less: purchases of property and equipment (12,012)
Free cash flow $ 16,836

Free cash flow: We define free cash flow as net cash provided by operating activities less capital expenditures.

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Reconciliation from GAAP Revenues to Non-GAAP Constant Currency Revenues and GAAP Percentage
Change in Revenues to Non-GAAP Percentage Change in Constant Currency Revenues (in millions, except
percentages; unaudited):
We provide non-GAAP constant currency revenues (“constant currency revenues”) and non-GAAP percentage change
in constant currency revenues (“percentage change in constant currency revenues”), because they facilitate the
comparison of current results to historic performance by excluding the effect of foreign exchange rate movements (“FX
Effect”) as well as hedging activities, which are recognized at the consolidated level, as they are not indicative of our
core operating results.
Non-GAAP constant currency revenues is defined as revenues excluding the effect of foreign exchange rate
movements and hedging activities and is calculated by translating current period revenues using prior period exchange
rates and excluding any hedging effect recognized in the current period. We calculate the percentage change in
constant currency revenues by comparing constant currency revenues to the prior year comparable period revenues,
excluding any hedging effect recognized in the prior period.
Revenues by Geography
Comparison from the Quarter Ended March 31, 2023 to the Quarter Ended March 31, 2024

Quarter Ended March 31, 2024

% Change from Prior Period

Quarter Ended March 31, Constant Less Constant

Less FX Currency As Hedging Less FX Currency
2023 2024 Effect Revenues Reported Effect Effect Revenues
United States $ 32,864 $ 38,737 $ 0 $ 38,737 18 % 0% 18 %
EMEA 21,078 23,788 204 23,584 13 % 1% 12 %
APAC 11,681 13,289 (439) 13,728 14 % (4)% 18 %
Other Americas 4,080 4,653 (152) 4,805 14 % (4)% 18 %
Revenues, excluding hedging effect 69,703 80,467 (387) 80,854 15 % (1)% 16 %
Hedging gains (losses) 84 72
Total revenues(1) $ 69,787 $ 80,539 $ 80,854 15 % 0% (1)% 16 %

(1)
Total constant currency revenues of $80.9 billion for the quarter ended March 31, 2024 increased $11.2 billion compared to $69.7 billion in
revenues, excluding hedging effect for the quarter ended March 31, 2023.

Comparison from the Quarter Ended December 31, 2023 to the Quarter Ended March 31, 2024

Quarter Ended March 31, 2024

% Change from Prior Period
Quarter Ended
Constant Less Constant
December March 31, Less FX Currency As Hedging Less FX Currency
31, 2023 2024 Effect Revenues Reported Effect Effect Revenues
United States $ 41,995 $ 38,737 $ 0 $ 38,737 (8)% 0% (8)%
EMEA 25,010 23,788 360 23,428 (5)% 1% (6)%
APAC 13,979 13,289 85 13,204 (5)% 1% (6)%
Other Americas 5,176 4,653 (72) 4,725 (10)% (1)% (9)%
Revenues, excluding hedging effect 86,160 80,467 373 80,094 (7)% 0% (7)%
Hedging gains (losses) 150 72
Total revenues(1) $ 86,310 $ 80,539 $ 80,094 (7)% 0% 0% (7)%

(1)
Total constant currency revenues of $80.1 billion for the quarter ended March 31, 2024 decreased $6.1 billion compared to $86.2 billion in
revenues, excluding hedging effect for the quarter ended December 31, 2023.

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Total Revenues — Prior Year Comparative Periods

Comparison from the Quarter Ended March 31, 2022 to the Quarter Ended March 31, 2023
Quarter Ended March 31, 2023
% Change from Prior Period
Quarter Ended March 31, Constant Less Constant
Less FX Currency As Hedging Less FX Currency
2022 2023 Effect Revenues Reported Effect Effect Revenues
Revenues excluding hedging effect $ 67,733 $ 69,703 $ (2,174) $ 71,877 3% (3)% 6%
Hedging gains (losses) $ 278 $ 84
Total revenues $ 68,011 $ 69,787 $ 71,877 3% 0% (3)% 6%

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Reconciliation from Certain GAAP Measures to Certain Non-GAAP Measures, Excluding the Effect of
Severance and Related and Office Space Charges (in millions, expect for percentages; unaudited):
We provide the following non-GAAP measures because they provide useful information to management and
investors about the effect on expense growth from the severance and related and office space charges taken in the
first quarter of 2023, and for comparability, the severance and related charges taken in the first quarter of 2024:
• Non-GAAP other cost of revenues, excluding severance and related and office space charges
• Non-GAAP operating expenses, excluding severance and related and office space charges
• Non-GAAP percentage change in other cost of revenues, excluding severance and related and office space
charges
• Non-GAAP percentage change in operating expenses, excluding severance and related and office space
charges
• Non-GAAP operating income, excluding severance and related and office space charges, and
• Non-GAAP operating margin, excluding severance and related and office space charges
These non-GAAP measures exclude the effect of severance and related and office space charges recorded during
the first quarters of 2023 and 2024. We calculate the percentage change by comparing expenses and operating
income to the prior year comparable quarter, each excluding severance and related and office space charges
recorded in the respective periods.

Quarter Ended March 31,

2023 2024 % Change
Revenues $ 69,787 $ 80,539
Other cost of revenues $ 18,891 $ 20,766 10 %
Less: severance and related charges (461) (153)
Less: office space charges (220) 0
Other cost of revenues, excluding severance and related and office space charges $ 18,210 $ 20,613 13 %

Operating expenses $ 21,760 $ 21,355 (2)%

Less: severance and related charges (1,533) (563)
Less: office space charges (344) 0
Operating expenses, excluding severance and related and office space charges $ 19,883 $ 20,792 5%

Operating income $ 17,415 $ 25,472 46 %

Operating margin 25 % 32 % 7%
Add: severance and related charges 1,994 716
Add: office space charges 564 0
Operating income, excluding severance and related and office space charges $ 19,973 $ 26,188 31 %
Operating margin, excluding severance and related and office space charges 29 % 33 % 4%

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