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“Google Cloud and YouTube Help Protect Alphabet From a Coronavirus Disaster - The Motley Fool” plus 1 more

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Google Cloud and YouTube Help Protect Alphabet From a Coronavirus Disaster - The Motley Fool Posted: 03 May 2020 11:47 AM PDT Some investors have criticized Alphabet (NASDAQ:GOOGL)(NASDAQ:GOOG) for being the least diversified among the tech titans. Microsoft has its software, cloud, and hardware empire; Apple practically prints money-making devices and has a burgeoning services segment riding sidecar; and Amazon.com has e-commerce cornered, plus the lead in cloud, and a myriad of other services. But Alphabet has ads, most of which are derived from Google. Sure, it has Google Cloud and YouTube, but the assumption was they were insignificant factors. Turns out that's far from the case. The company started breaking down its results to show Cloud and YouTube during its final report from 2019, and it continued to shed light on its highest-growth businesses to kick off 2020. The ad business took an unsurprising hit due to coronavirus lockdowns, but things weren't as bad as they could have been. Image source: Getty Images. Google Cloud and YouTube to the rescue Alphabet CEO Sundar Pichai kicked off the quarterly update on Tuesday with some comments regarding the crisis, noting this is the first time a pandemic (and resulting recession) has taken place in a digital-first world. Though many businesses are taking a serious beating due to shelter-in-place and work-from-home orders, other areas of the economy are proving resilient even as social behaviors get disrupted -- perhaps permanently. Ad revenue grew year over year through February before declining to a mid-teens percentage rate after the lockdown was put in place in mid-March. However, Google Cloud saw another massive increase in sales as businesses scrambled to put continuity plans in place to keep operations running, and to pace surges in web and internal network traffic. Pichai rattled off a long list of organizations Google Cloud is helping, from the State of New York to e-commerce powerhouse Shopify to AT&T. Cloud is helping many companies transform their processes, but many others have been using Google's G Suite of cloud-based tools for a long time. The subscription service now boasts over 6 million paying customers.   YouTube did pretty well, too, and while ads on the platform reversed course late in the quarter, annual growth merely decelerated to a high-single-digit percentage rate in March. And the "other" segment notched big gains, driven by YouTube's new subscribers (like TV and Music) and higher usage of the Play app store. The "other bets" investment portfolio was a drain on the bottom line, but progress was made on that front as well. The Waymo autonomous vehicle business raised $2.25 billion in its first outside investment raise, and Wing autonomous delivery saw traffic rise by five times thanks to test programs in Virginia and Australia.   All told, the Alphabet family did pretty well considering the dark clouds hanging over. Segment Q1 2020 Revenue Q1 2019 Revenue % Change Google search and member properties ads $29.7 billion $27.6 billion 8% YouTube ads $4.04 billion $3.03 billion 33% Google Cloud $2.78 billion $1.83 billion 52% Other (YouTube subscriptions, Google Play, etc.) $4.44 billion $3.62 billion 23% "Other bets" and hedging $184 million $307 million (40%) Total revenue $41.2 billion $36.3 billion 13% Free cash flow $5.45 billion $7.36 billion (26%) Data source: Alphabet. Google ads are down, but certainly not out But what of the primary driver, Google search and resulting ads? Expect a rough Q2 report card as the bulk of COVID-19 disruption is going to show up during that period. Pichai and CFO Ruth Porat weren't ready to expound on specific numbers Google is seeing in April, but it may not be as ugly as some investors had feared. Pichai expounded: The good thing about Search Ads and direct response on YouTube as well, but Search primarily, is that it's an extraordinarily effective system. It's a transparent system. [Advertisers] have a very clear sense of [return on investment]. It's very measurable, highly cost effective. And so we have always seen -- and we saw this in 2008 as well -- people respond in the short-term, but the recovery is also fast when it comes back.   The flexibility to quickly turn Google search ads off and on, and the cost-effectiveness of running those ad campaigns, thus means a quick rebound in results is likely in store once things begin to normalize. Plus, digital advertising is still on a long road to becoming the dominant and preferred method of advertising around the globe. Coronavirus is certainly going to be a speed bump, maybe a big one, but Google search and ads business is still in growth mode. But the real deal sweetener is that Google is quickly becoming a diversified high-growth company, with multiple levers to pull to propel its results higher. The tech giant remains a portfolio staple in my book.

Multicloud deployments become go-to strategy as AWS, Microsoft Azure, Google Cloud grab wallet share - ZDNet Posted: 28 Apr 2020 06:00 AM PDT Enterprises are all-in on multicloud as 93% of companies have a strategy to use multiple providers as Microsoft Azure, Amazon Web Services and Google Cloud all vie for customers and grab more wallet share, according to Flexera's State of the Cloud report. The findings highlight how multicloud is becoming the primary architecture choice as companies plan to mix clouds to avoid lock-in. Flexera had 750 respondents with 554 enterprises and 196 small and medium sized businesses. Of the respondents, 53% were advanced cloud users. Flexera found that the top three public cloud providers remain AWS, Azure and Google, which has the fastest adoption in growth compared to a year ago. Flexera also found that Azure is narrowing the gap with AWS in the percentage of enterprises using it as well as the number of virtual machines. Forty percent of AWS users spend at least $1.2 million annually with 36% spending that amount on Azure, according to Flexera. To move their multicloud strategies along, Flexera found enterprises are betting heavily on containers. According to Flexera: 65% of organizations are using Docker for containers with 58% using Kubernetes. Container-as-a-service offerings from AWS, Azure and Google are all seeing strong growth. Enterprises say they are lacking in resources and expertise to deal with container challenges. And 33% of organizations use multicloud management tools. COVID-19 may also accelerate shifts to the cloud. Flexera found at least half of companies are accelerating their cloud plans amid the COVID-19 pandemic and move to remote work. Indeed, 59% of enterprises say cloud usage will exceed prior plans due to the pandemic, according to Flexera. Among other key findings: Respondents said more than 50% of enterprise workloads and data are expected to be in the public cloud within 12 months. SMBs are moving to the cloud at a faster rate with 70% of smaller enterprises saying data and workloads will be in the cloud in the next 12 months. 87% have a hybrid cloud strategy. 79% of respondents plan to optimize existing use of cloud for cost savings, with 61% focused on cloud migration. IoT is the top growing cloud platform as a service offering followed by container as a service, machine learning and AI, data warehouse and serverless. 73% of enterprises have a cloud team that is centralized and 51% use managed service providers to manage usage. 83% of respondents said security is their top challenge with 82% citing costs. 56% of organizations said understanding the cost implications of software licenses is a big cloud challenge. Respondents said 30% of cloud spend is wasted. Understanding app dependencies was the top challenge for cloud migrations followed by technical feasibility and assessing on-prem vs. cloud costs. Ansible and Terraform were the two most widely adopted configuration tools. 63% of enterprises are adopting relational DBaaS. VMware vSphere leads in private cloud adoption with Azure Stack and AWS Outpost showing strongest growth. 22% of enterprises spend more than $12 million a year on public cloud.

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