Google Q3 2021 Earnings

Google Q3 2021 Earnings

Numbers

• Revenue: $65.1B vs $46B in Q3, 2020
• EPS: $28 vs 16.4 in Q3, 2020
• Operating Income: $21B vs 11.2B in Q3, 2020
• Net Income - 18.9B vs 11.2B in Q3, 2020
• Operating margin - 32% vs 24% in Q3, 2020

Segment Breakdown

• Google search 37.9B vs 26.338B in Q3, 2020 up 43%
• Google Cloud revenue: $4.99 billion vs. 3.44B in Q3 2020 up 45%
• YouTube ads: $7.2 billion vs. $5.03 billion in Q3 2020 up 23%
• Traffic Acquisition Costs (TAC): $11.5B billion  vs. $8.1B
• Google Network 7.9B vs 5.7B in Q3, 2020 up 38.5%
• Google Other(hardware, playstore, non-advertising youtube revenues) 6.7B (5.4B in Q3 2020) up 24%

Operating Income breakdown

• Google Service - 23.9B
• Cloud lost 644M in Q3. Prediction is that in 2021 Cloud will be cash flow positive
• Other bets lost 1.2B
• Google ends the quarter with 142B in cash

Highlights and Opinions from earnings call

• Retail

• We've seen explosive growth in digital over the last 20-some months. But as the world begins to reopen, shoppers are returning to stores. Brick-and-mortar isn't dead. Instead, omnichannel is in full force. Searches for open now near me are up 4 times globally versus last year. Strong growth in local shopping queries means people are researching their visits to stores more often before they go. As a result, we've seen more advertisers include in-store sales alongside e-commerce goals to drive omnichannel growth. Adoption has nearly doubled over the past year.

• Youtube 
• We recently surpassed 50 million music and premium subscribers, including those in trial, and YouTube Shorts continues to see higher adoption rates. In the past year, the average number of daily first-time creators more than doubled.

• Over 2 million creators are now making money and building their businesses on YouTube via YouTube partner program with 10 different ways to monetize their content from Super Chat to BrandConnect. The next generation of businesses and media companies are being built by creators on YouTube and we're excited to help them grow.

• Other revenues : Google play > Youtube > Hardware
• Signing multi-year multi-product partnerships through Cloud
• Univision, T-Mobile
• Very strong customer momentum in data cloud - Twitter
• AI/ML - Financial services, fraud and risk - HSBC
• Bigquery - business intelligence cloud
• Operational efficiency - migrating data center to Google Cloud
• Google workspace - nurses and retail store workers
• Waymo

• Waymo began welcoming riders to its trusted tester program in San Francisco, in addition to its fully autonomous Ride-Hailing Service currently in Phoenix. Next year, Waymo will open a dedicated trucking hub in the Dallas-Fort Worth area, helping support commercial freight routes across the Southwest. And we announced last week the first commercial expansion of Fink's on-demand air delivery service to Walgreens customers in select locations.

• 150 million people across 40 countries are now using Google Pay to manage transactions and stay on top of their finances.