Alphabet reduced Workforce and Office Space in 2023 Q1

Alphabet (NASDAQ: GOOGL) announced its 2023 Q1 financial results on April 25, 2023. According to the announcement, revenues were up 3% (YoY, 3 months). In addition, operating income and net income were down 13% and 8%, respectively. 

Looking at revenue growth by segment, Google Cloud had the highest growth of up 28%. It was followed by Google Search & other of up 2% (YoY, 3 months). On the other hand, Google Network decreased the most of down 8%, followed by YouTube Ads at down 3%. 

As for revenues by geography, Americas other than the U.S. had the highest growth of up 6%. It was followed by EMEA and the United States, of up 4% and 4%, respectively (YoY, 3 months). On the other hand, APAC revenue were down 1%, recorded the worst performance in this quarter.

Although operating cash flow was down 6%, free cash flow (FCF) was up 28% (YoY, 3 months). The larger increase in FCF appears to be due to reduction in the amount of purchase of marketable securities.

People are siting in front of PCs in an office.
Photo by Austin Distel on Unsplash

Since January 2023, Alphabet has been reducing its workforce and office spaces. Related costs were recorded in 2023 Q1 results.  In addition, the company extended the useful lives of server and network equipment. Its depreciation expenses will possibly be decreased in each financial period in the future. 

Considering these factors, we believe that Alphabet’s operating income and net income may increase in the future.

Alphabet Inc. (NASDAQ: GOOGL) Stock Chart

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  1. Watanabe & Brothers’ Investment is holding shares of Alphabet. 
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