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bitcoind3 t1_j7ejb3k wrote

For those of us who are not seasoned accountants:

  • Research and Development
  • Sales and Marketing
  • General and Administrative

Gnash_ t1_j7f0psh wrote

yeah I was wondering what S&M could stand for in this context


Deribus t1_j7f4xyi wrote

That's just the department that writes the EULAs


j0akime t1_j7fk7tj wrote

Where in this chart would employee salary / compensation show up?


SteveSharpe t1_j7fp5a0 wrote

It could be any of those depending on the nature of the work each individual is doing. Sales people salary going into S&M, general corporate type workers in G&A, and engineering costs into R&D as an example.

Also, service workers might even come out before the operating profit line under cost of revenue.


bitcoind3 t1_j7g4dcj wrote

"it depends"

Some bits are self explanatory (sales, marketing, ...). Chances are most of the "brains" of Google (coders and the like) fall under R&D since that is often taxed more favourably. A lot of staff, particularly the people who literally keep the lights on (anyone who works on data centre hardware) will fall under cost of revenue.


egonzo61 t1_j7dk1b1 wrote

Google sure spend a lot of money on S&M. Now that's kinky!


SamFish3r t1_j7e9kll wrote

-21%YoY but everyone seems bullish as f


DataMan62 t1_j7esul4 wrote

But their gross profit is up 7%. Look at what they are spending their modestly growing profits on:People: R&D +25%, Sales +16%, G&A +16%; Machines: Content Acq, Data Centers +18%, Traffic Acq +7%.

Then look at their revenue growth: Google Cloud up 37% and the bread and butter Search Adv is up 9%. On $162B, 9% is real money.

They are re-inventing themselves as a technical platform company, basically selling and expanding the platform they used to build their advertising machine which got them to this point. BTW, Amazon's AWS is, I think, the leader in cloud platforms, so competition is fierce.

That does seem like a huge increase in people costs, some of them overhead. Maybe that's why they laid off 10,000 people or so recently.


mk100100 t1_j7h690k wrote

Maybe it is just me but I find Google search engine works not as good as it used too, harder to find what I am looking for. I hope they will re-re-invent it


DataMan62 t1_j7jbxon wrote

Google never had the best search imo. Just the most popular and profitable.


SirThatsCuba t1_j7efdnl wrote

I would really like this itemized between S and M please ( ͡° ͜ʖ ͡°)


human-exe t1_j7f3n8i wrote

Spending so much money on S&M to get even more gross stuff profits


fewtradesjack t1_j7e9q4d wrote

Fantastic use of a Sankey diagram IMO. This presentation makes the contents of Alphabet's income statement much more accessible, and makes comparing the relative size of these different components easy (and I suspect many otherwise uninterested folks would not take the time to find these numbers/compare them otherwise!).


andrewrgross t1_j7eug5j wrote

The main thing I take away is that company-wide layoffs don't seem to be motivated by necessity. It's not like some giant unforeseen event just toppled their primary business model. If a correction was needed, it should be enough to reduce hiring in relevant divisions, or trim 1 or 2 % of those relevant divisions. Slicing off 6% of the entire company because you had a 5% decline in operating profit even with roughly a year's worth of gross profit in reserve is just ruthless and greedy as fuck.


Noodles_Crusher t1_j7f5z7k wrote

>The main thing I take away is that company-wide layoffs don't seem to be motivated by necessity.

-21% Net profit yoy.

Also, Alphabet's number of employees through the years:

2021 was 156,500, a 15.67% increase from 2020

2020 was 135,301, a 13.79% increase from 2019

2019 was 118,899, a 20.38% increase from 2018

2018 was 98,771, a 23.29% increase from 2017

don't get me wrong, layoffs suck, but even after cutting 12k people they're still way above last year's initial headcount.


dinosaur-in_leather t1_j7fa8s9 wrote

Pandemic hires seem to have displayed old and paternity talent in Google...


Noodles_Crusher t1_j7fds5z wrote

I don't have any insight into that, we're just discussing headcount at this point.


dinosaur-in_leather t1_j823gl7 wrote

Does a head count include the individuals who are expecting parents??? Does it include the individuals who just had kids and got fired??? It's a massive number of illegal firings Google came out and said that they miscalculated severances most likely trying to stay within the legal limits of firing paternity workers. Google do evil


andrewrgross t1_j7hi4sy wrote

The issue I have is that these companies have clearly internalized a belief that layoffs are a tool with no downside and embrace them casually as a part of deliberate, planned strategies.

They didn't need to hire that aggressively. And if any pressure against layoffs existed, they almost certainly wouldn't have.

Layoffs are a part of the trend towards "blitzscaling", which I think is irresponsible in startups, but unconscionable in established firms.

Look at those numbers! They grew their staff 23% in 2018? And then 20, and then 13, and then 15... The company is 24 years old! There is no reason for them to be trying to double in four years! Especially not in the midst of a global upheaval.

My point is that the hiring managers were paying people to relocate in 2022 when they knew that many of those people were likely going to be out of a job within months. We need to stop normalizing this kind of labor economy. Think of the kids who have to move to new schools only to suddenly have an out of work parent while they're trying to reorient themselves. We build the economy. There's no reason to make it so heartless.


Noodles_Crusher t1_j7hujmj wrote

>There is no reason for them to be trying to double in four years! Especially not in the midst of a global upheaval.
>they knew that many of those people were likely going to be out of a job within months.

that's a lot of assumptions based on nothing but opinions, unless you're saying that you've got a clear idea of what the people that were hired were doing in the company.

I get it, layoffs bad - and yet, more people (not less) do have jobs thanks for those hiring sprees.

I see it as a net positive, you do you.


vyratus t1_j7fugy7 wrote

Have a few friends at Google, and was recently chatting to a head of EU for a midsize tech company. Consensus is that FAANG type companies are using the market as an excuse to get rid of dead weight, I assume because if they did it when nobody else was it would attract a lot more bad press


andrewrgross t1_j7hgfjd wrote

I think you're right that they're acting as a herd to reduce negative exposure, but I don't think they're removing dead weight. I think they're shedding weight, regardless of whether it's dead or not. From what I've read, the goal clearly prioritized reducing the size of the company over specifically removing low performing individuals or projects.


Nonbottrumpaccount t1_j7gajjs wrote

So its greedy for a company to fire labor they determine don't need?

It isn't like Google has some obligation to spend a certain ratio of its revenue/profit on labor. The fact that this ratio changes just means that they are getting more or less productive as a company.


andrewrgross t1_j7hg1kk wrote

>So its greedy for a company to fire labor they determine don't need?

First, I don't think you mean "need".

Most profitable companies don't need most labor. They gain value from it, but that's different than needing it. I think what you mean to ask is, 'Is it greedy for them to terminate workers if they conclude it's a good financial decision?'

And the answer is that it's subjective. I think it's absolutely a demonstration of greed, but I try to work in objective measures.

I think objectively, the costs of this action are very, very high, unless you strip worker well-being and the well-being of our society at large entirely from the cost assessment equation.


Nonbottrumpaccount t1_j7iqey0 wrote

In what way was your assessment of this situation objective? You didn't offer a single piece of objective evidence that Google (or alphabet) doesn't care about the wellbeing of our society or its workers.

Objectively speaking they employ 10,000s of workers and compensate them extremely well relative to the average worker. They generate billions of dollars for investors, offer products that nearly the entire world uses and benefits from, have an incredible "green" record, and have donated billions to charity over the last 20 years.

On top of this, as others have pointed out in this thread, they hired a lot of people over the last two years and this workforce reduction, or whatever corporate buzzword they use, is taking them back to historic levels of employment.

Of course these companies are "greedy", they only exist if they make money. But relatively speaking, Google and pretty much all other fortune 50 companies, are probably the most generous to their employees and society.


andrewrgross t1_j7j2cc2 wrote

As I said, I think our takes will differ based on what our metrics are.

My metrics include how much agency and stability do their employees feel they have? And how much stability does the larger industry workforce feel they have? How much of employees value addition goes to them versus investors? Does their user base have high trust and use their products enthusiastically? Reluctantly?

But that's the subjectivity. If you look at big tech and judge their success by, "do they make investors money?" then you will likely score a company highly that I think has a lot of room for improvement.


Living-Walrus-2215 t1_j7feojc wrote

>The main thing I take away is that company-wide layoffs don't seem to be motivated by necessity.

You're welcome to hire them on yourself if you believe that to be the case. I'm sure Google would be happy to allow them to keep working if you're the one paying for them.


gibl3t t1_j7hi4c2 wrote

weird take but ok


Living-Walrus-2215 t1_j7hk0fj wrote

Seems like a perfectly reasonable take.. If you want to give jobs to people, you should be the one to pay them.


dinosaur-in_leather t1_j7fa3gs wrote

You could probably get chat GPT to generate an XML file that would represent as a visual given financial statements...


IncomeStatementGuy OP t1_j7ddfju wrote


Separate-Ad-6224 t1_j7dr59t wrote

You’re the one who created this visual? I’ve seen it a couple times and took a screen shot of some (I think the Bank of America was the best I’ve seen). Is there a website where we can upload our financial dataset and create this monthly?


IncomeStatementGuy OP t1_j7er4db wrote


I develop the website and used it to create this visual. Your use case is precisely what the website is for.


zooomenhance t1_j7gnpoo wrote

Would love to see a broad breakdown of government spending


IncomeStatementGuy OP t1_j7gnw4c wrote

Would be interesting. Do you have a good source for the raw data?


zooomenhance t1_j7gq05s wrote

I guess it wouldn’t be your typical chart since you aren’t showing profit and expenses but where the spending goes to each agency. This gov site has an overview of spending as well as some data tables with details Here’s a page focused on revenue sources, it sounds like they base their charts off of the Monthly treasury statements linked at the bottom


Dmytro_North t1_j7dsljh wrote

Sankeymstic does something similar online for free. This might be done in adobe illustrator.


no_buses t1_j7dknd8 wrote

Why does Google pay a lower tax rate than I do when they make more than a million times what I make?


NineNewVegetables t1_j7ebvef wrote

Because their accountants are more numerous and better-paid than yours. To say nothing of their lobbyists.


Obvious_Chapter2082 t1_j7dppml wrote

Their effective tax rate really has no relation to the income tax they pay. It’s possible they pay much more than that reflects


no_buses t1_j7ejxwf wrote

Corporations don’t pay income taxes, they pay corporate taxes. Income taxes are paid by Google’s employees.

The federal corporate tax rate is 21%, and Alphabet Inc. is registered in Delaware so they don’t pay state tax. If you make 45k a year or more (after deductions), your marginal tax rate (not effective tax) is lower than Google’s.


Obvious_Chapter2082 t1_j7f32c3 wrote

That’s…not true

Corporate tax is also referred to as “corporate income tax”, because it’s a tax on their income. On the income statement, this is labeled as income tax expense

Registering in Delaware doesn’t mean you don’t pay state tax, as your income gets apportioned to every state that you operate it. Registering in Delaware is for legal reasons, not tax reasons

And you also can’t really compare individual and corporate tax rates. A rate for a corporation is based on their income tax expense instead of the tax they actually pay


jt121 t1_j7fx8co wrote

Technically, corporations pay income tax equivalent to all of their employees' income tax (part of FICA), along with a corporate income tax. So, technically they pay the tax you pay and then some. That said, I'm firmly in the camp that Google and others should pay much more to encourage reinvestment of their profit instead of money hoarding like Google and other multi-billion-dollar corporations do.


implicitpharmakoi t1_j7kvyb4 wrote

>corporations pay income tax equivalent to all of their employees' income tax

This is wrong or badly phrased.

They pay payroll taxes, so however much you pay in fica on your paystub, not the whole income tax.


jmlinden7 t1_j7fxujm wrote

Corporations generally pay a 15% income tax


Big_Joosh t1_j7giu2q wrote

What's your average tax rate?


no_buses t1_j7halit wrote

Around 16%.


Big_Joosh t1_j7hit15 wrote

Alphabet paid nearly $19 billion in taxes, according to cash taxes paid on the cashflow statement (a much better proxy for income taxes paid).

That equates to ~26.5%. 65% higher than your average tax rate, and higher than the 21% corporate income tax rate.


no_buses t1_j7igso3 wrote

That’s not the info shown on this chart. And worth noting that that would be roughly the effective tax rate of someone earning 200k. That’s not a poor person by any stretch, but definitely nowhere near 19 billion.


vohms t1_j7e4w8a wrote

I first read this as "Snakey diagram," and then looked at the image and thought, "that makes sense."


Broccoli_headed t1_j7fdcb5 wrote

I read “safekey” and thought “yeah this makes it so easy to understand even after school fourth graders could digest income statements”


gza_liquidswords t1_j7efapq wrote

They bought youtube for 1.65Billion, and it generates 29Billion/year revenue for them.


Willingo t1_j7eq98j wrote

Sure, but what are the profits


SpunkySamuel t1_j7exchg wrote

I’ve always wanted to know this. They said before that they barely profit, but I need to know how true that is


LordBrandon t1_j7oea0i wrote

Thats not just a lucky investment, they've pumped an unimaginable amount of money and effort building it to what it is today.


querry22 t1_j7dsxr3 wrote

Innovative company makes most their money from selling ads. Ads. What a legacy


FIleCorrupted t1_j7ehfdm wrote

Sure, but really viewing the ads is the currency you are using to pay for their products. So their legacy is all of the products that users pay for with their attention.


querry22 t1_j7ehsey wrote

Oh wow I never thought of that before.


dogpetter420 t1_j7emq0k wrote

You think I pay attention to ads? 😂

I’m not trying to sound cool here, and I don’t think this makes me special, but I’m over 30 and I think I’ve maybe purchased 3-4 things in my adult life because of an ad. I seriously do not understand how ads are profitable


mavric22 t1_j7eo2vl wrote

Because despite everyone believing 'ads don't work on me', they actually do work.


Sidereel t1_j7ew08c wrote

For one thing there’s a lot more to it than being something you can directly click on and purchase something. It’s also about branding and recognition. They want to make sure people know about their product or service.


KramItFoo t1_j7eio5t wrote

"Other revenue" is just a casual $3B


bat_in_the_stacks t1_j7f6dvn wrote

I wonder if this is where their hardware revenue is (pixel phones, nest devices, etc.)


jsveiga t1_j7di7h9 wrote

So where is all the "they sell our data" revenue?

Is that the "AdMob, AdSense and others"?


IncomeStatementGuy OP t1_j7djylr wrote

They make more money by serving you personalized ads.

Collecting data about you increases their revenue lines for Search, YouTube and AdSense (ads on websites other than Google and YouTube).


FIleCorrupted t1_j7ehbzr wrote

There's a big misconception about what is meant by "selling your data". Your data is how they create value, but they don't literally sell excel files of everything you do.

The better the data they collect on you, the more effective they can make their advertisements. For example, maybe a grocery store chain asks google to target a specific ad at users who have been to competitors stores in the past x weeks. They don't sell that customer your data, but they use your data to fulfill the customers request.


MattWindowz t1_j7ejv1x wrote

Hey, I work in advertising, I can provide a little insight here. When we want to advertise to a specific type of person, Google (and other social media compaines) doesn't give us data and let us target individuals. What we do is select certain keywords, phrases, or interests that we want to target, and their algorithm uses your data to determine if you're the kind of person that we are trying to advertise to. Detailed data is important for Google, because if their data is bad, our ads won't go to the right people, and we won't make sales, so we'll spend our money elsewhere.

Tl;dr advertising revenue is data revenue.


lykosen11 t1_j7erlx0 wrote

Google do not sell your data. They just don't. Never have.

It's waaaaay more profitable for them to deliver your ads optimized through your data.


swankpoppy t1_j7e4346 wrote

Question - It says “Youtube”, what does that include? I assume not advertising on the YouTube site?


lucun t1_j7enx13 wrote

You're better off just reading the earning report yourself than trusting reddit to do that for you. The YouTube $29B revenue in the chart is actually YouTube Ads. The Playstore and Other $29B in the chart includes non-ad revenue from YouTube and many other things.

YouTube is tricky since Alphabet sort of hides YouTube's total revenue and net income.


swankpoppy t1_j7fe6zt wrote

Thanks! This helps clear it up. I suspected not all of YouTube’s revenue was from ads. YouTube TV, blah blah blah.


block36_ t1_j7e5sc8 wrote

Either the ads or any of the subscriptions. They probably also take a cut of stream donations and channel memberships.


swankpoppy t1_j7e952p wrote

Wasn’t sure because there’s a separate bucket for ads but I’m assuming that’s just ads from google, not YouTube? I’m really curious what the distribution of income looks like for YouTube. Is it mostly ads or subscriptions or whatever.


I__Know__Stuff t1_j7eoslj wrote

The top left category is specifically search advertising. Youtube advertising revenue is in "Youtube".


swankpoppy t1_j7fe235 wrote

So how does that break out? Are ads the only source of revenue YouTube has? I would have thought there would be direct revenue too, from YouTube TV, things like that. Is that in “other revenue”? I’m asking if anyone has that data. Is 100% of YouTube’s revenue from ads because that’s what this is implying and it seems wrong.

I don’t like how this chart is supposed to show where all the money goes, but has $29B for YouTube, basically the size most companies, as one bucket that’s shown as all ad revenue. I don’t believe that’s true.


I__Know__Stuff t1_j7feh2m wrote

Another comment said that YouTube's non-advertising revenue is counted under Playstore.


swankpoppy t1_j7ff62h wrote

Thanks! That makes sense. I’m just surprised they have a bucket that large and don’t elaborate on what “other” means. Seems dodgy.


TheSummerlin t1_j7dmoej wrote

I may be looking at this wrong, but where is the income from tech sales?


SUPRVLLAN t1_j7e9710 wrote

There is none.

Google hardware is a loss leader.


halibfrisk t1_j7edkv0 wrote

There’s revenue / income from tech sales regardless of whether it generates a profit or loss.

>Google’s hardware products, including the Pixel smartphone, the Chromebook laptop, and Nest smart home devices, generated a total of $19.6 billion in revenue in the same year.


lucun t1_j7eoif3 wrote

Alphabet likes to hide costs and net income of segments unlike how granular they break down revenue. Might be a good thing since it can shield those segments from greedy investors and competitors. It's also hard to breakdown as I've heard they do have engineers that do work affecting multiple Google segments at the same time, which makes it hard to attribute costs accurately.


anon_runner t1_j7ebpjw wrote

Wow, this is an amazing way to understanding concepts like revenue / top line, COGS, Gross Margin/Profit, Operating Profit and Nett Profit ... Thanks ... I am saving this for reference!


peter303_ t1_j7e179t wrote

I wish I could pay 3.9% tax on my income. ☹️


Obvious_Chapter2082 t1_j7e6gag wrote

Start a business


thewhalehunters t1_j7ecwzl wrote

Yeah but then he would learn about payroll tax among other things and then learn that Google pays more in taxes than he realizes.


SeriousSamStone t1_j7exndk wrote

> Perhaps one of the best-kept secrets of payroll taxes is that employees effectively pay almost the entire payroll tax, instead of splitting the burden with their employers.

> This is because tax incidence is not determined by law, but by markets. In fact, the person who is required to pay a tax to the federal government is often different than the person who bears the tax burden. Usually, the marketplace decides how the tax burden is divided between buyers and sellers, based on which party is more sensitive to changes in prices (economists call this “relative price elasticities”).

> It turns out that the supply of labor – that is, workers’ willingness to work – is much less sensitive to taxes than the demand for labor – or employers’ willingness to hire. This is because workers who need a job are not as responsive to changes in wages, but businesses are able to “shop around” for the best workers or shift production to different locations.

> This means that, rather than workers and employers each paying 7.65 percent in payroll taxes, employers send their portion of the tax to the government and then decrease workers’ wages by almost 7.65 percent. Next, workers pay their 7.65 percent share on those wages. In effect, there is hardly such a thing as the “employer-side” payroll tax, because almost the entire burden of the payroll tax is passed on to employees in the form of lower wages.



acebandaged t1_j7frluo wrote

Kinda dumb to defend tax avoidance by a massive corporation


Obvious_Chapter2082 t1_j7gdur8 wrote

It depends on the reason why. Most of why Googles rate is low is due to employee compensation and R&D. Why are either of those bad things?


acebandaged t1_j7gx4fz wrote

The status quo has created massive income inequality, and is rapidly driving the US towards a breaking point as a result. Google's tax rate isn't low because employee comp and R&D, it's low because they spend massive amounts of time and money figuring out how NOT to put money back into the economy. We need to fundamentally change the way we approach corporate taxes in order to return some equality to the people.


Obvious_Chapter2082 t1_j7i3hud wrote

>isn’t low because employee comp and R&D

Their 10-K is public record, it’s absolutely due to employee comp and R&D


acebandaged t1_j7kkg9f wrote

I'm saying that the fact they can use that as an excuse not to pay more taxes is a problem


thewhalehunters t1_j7id4zv wrote

Jesus christ dude. The tax rate isn't what is driving income inequality. Not even close to correct. Read a damn book instead of inventing dumb ideas.


minorcontribution t1_j7ewl9h wrote

For me, this puts all those axed programs into a bit of perspective. With a profit margin of 21% of a whopping 60B dollars, it kind of doesn't really matter how profitable a program is if it can't grow big enough to make an impact on that. A couple of millions just won't matter to google.


Big_Joosh t1_j7giomu wrote

I love these diagrams because it really shows who understands corporate taxes.

Those who see the 11b and complain simply don't know how to read a 10-K, which is fine but it becomes a problem when everyone latches onto that and it ends up affecting policy decisions.

Truth is, Alphabet paid nearly $19 billion in taxes, according to cash taxes paid on the cashflow statement (a much better proxy for income taxes paid).

That equates to ~26.5%, which is higher than the 21% corporate tax rate.


Some-Imagination9782 t1_j7dpaar wrote

16% percent increase in G&A expenses 🤯


davispw t1_j7g0qel wrote

This and related cost increases is the reason cited for layoffs—that costs were increasing faster than revenue.


Some-Imagination9782 t1_j7g9qm5 wrote

Yeah no wonder they had layoffs.


davispw t1_j7gbzzg wrote

I mean, this is the “wall street” answer. Could they have burned some of the $0.1T cash on hand to ride out the dip in the economy? Why did they hire so much, and continue to hire even after it was clear things were slowing down in 2022? Why wouldn’t a hiring freeze + attrition and internal transfers have been enough?


rmmcclay t1_j7fgsfc wrote

This is wonderful. The graphic really makes it easy for my simple mind to understand Google's revenues, expenditures and profits. Thank you.


EmoInTheCreek t1_j7ehvzd wrote

That's 5 Billion in profit per month!


ell_moo t1_j7fn6h4 wrote

Imagine having $4B in 'Other' costs. That's the GDP of some countries!


MyAnswerIsMaybe t1_j7ge6ek wrote

60 Billion in profit and they are cutting staff in 2023.

If its a good year the owners reap the rewards, if its a bad year the employees face the consequences.


LordBrandon t1_j7oepte wrote

Most of thoes billions goes to paying people. You're only happy if it's 100%?


MyAnswerIsMaybe t1_j7plbci wrote

60 billion is after they paid people.

60 Billion was just stock piled or used to grab up as many assets as they can.

I would suggest that a company has to take that profit and share it with everybody equally. No stock buy backs, no dividends, nothing of that sort.


LordBrandon t1_j7q2bns wrote

Why would anyone ever start a company, or invest in a company if they could never be compensated for it?


MyAnswerIsMaybe t1_j7q2isc wrote

Idk but people still buy Microsoft stock and I believe the CEO is paid pretty good


al1ceinw0nderland t1_j7hizui wrote

So all those YouTube ads, for that measly slice of revenue?


Fox-noir t1_j7eqvpv wrote

Why operating profit to net profit yoy changes don’t add up

Op. Profit 75B, -5% -> ~80B

Net profit 60B, -21% -> ~67B Tax. 11B, -23% -> ~14B Others. 4B, 0% -> ~4B

Total distributed 85B to 80B

how is that ?


IncomeStatementGuy OP t1_j7eskxm wrote

This year they had other expenses 4B. Last year they had other income, so the sign of the „other“ flipped.


BijzondereReiziger t1_j7erpn4 wrote

No wonder Google is scared as heck for more people using a functional adblocker (uBlock origin). Their whole company would collapse without advertising. Kind of expected them to diversify more than they have managed to do.


DataMan62 t1_j7ethrr wrote

Diversification is Google Cloud and YouTube and Google Play.


BijzondereReiziger t1_j7euke9 wrote

But as we can see that isn’t working too well


roller3d t1_j7exx33 wrote

I don't know man, ~90 billion in revenue is quite a lot...


[deleted] t1_j7jcwle wrote



roller3d t1_j7jdain wrote

Huh? I'm responding to BijzondereReiziger by pointing out that there are ~90B of revenue outside of search ads and ad network.


DataMan62 t1_j7jk9mk wrote

I misread your tilde as a - the first time.


DataMan62 t1_j7ewh6v wrote

Well, I don't know. Their main business is sooo huge, that it is very hard to match it. I wouldn't mind to be a major shareholder in Google.


OfficialZygorg t1_j7exd49 wrote

How do you guys do these tables?


IncomeStatementGuy OP t1_j7eyqir wrote

Do you mean the data input to create the diagram?

These are the first lines of the table (numbers are from the official Alphabet income statement)
Search advertising Ad revenue 162.45 148.951
Youtube Ad revenue 29.243 28.845
AdMob, AdSense & other Ad revenue 32.78 31.701
Ad revenue Revenue 224.473 209.497
Playstore and other Revenue 29.055 28.032
Google Cloud Revenue 26.28 19.206
Other revenue Revenue 3.028 0.902
Revenue Gross profit 156.633 146.698
Revenue Cost of revenue 126.203 110.939
Gross profit Operating profit 74.842 78.714
Gross profit Operating expenses 81.791 67.984


dinosaur-in_leather t1_j7f9xxf wrote

Frankly I would love to see how much sell taxes are paid for cost of revenue branch but that would require sources information.


IncomeStatementGuy OP t1_j7facia wrote

I am not sure but I think sales tax is not recognized as revenue in the first place such that isn't part of any of the flows visualized here.


dinosaur-in_leather t1_j8240g9 wrote

I was thinking that consumers helped pay into the social safety net unemployment but that's not the case.


Redarrow762 t1_j7fntrd wrote

I was looking for the tab that said selling private data. I guess it is all of it.


Sweaty-Curve-9918 t1_j7frg17 wrote

Whats the difference b/w cost of revenue and operating expenses?? Is one hard assets and the other labor/personnel related??


IncomeStatementGuy OP t1_j7g127b wrote

>Whats the difference b/w cost of revenue and operating expenses?? Is one hard assets and the other labor/personnel related??

Cost of revenue contains costs that are directly needed to produce and distribute the product/service. If you are an internet software company, you need to run servers, you might need to compensate the creators on your platform (this is the case for YouTube) and you might need to pay moderators to moderate your social network. These things are "cost of revenue".

Costs for, say, management salaries or R&D engineers are not directly needed to keep the product/service running, so they are operating expenses.


tilman2015 t1_j7fvkyd wrote

$49B "traffic acquisition costs" - what does this include?


IncomeStatementGuy OP t1_j7fw7bd wrote

For example payments to Apple to be the default search engine on iPhone


tilman2015 t1_j7fy8sd wrote

That was what I guessed but it seemed really high - especially when Google's Chrome is the de facto browser of the Internet with Google as default.

I imagine it's commercially sensitive but would be cool to know who they pay what to!


ChumburidzeGio t1_j7ej3qv wrote

Would not expect YouTube to make less than even AdMob/Adsense revenue, considering how much they have to pay there to content creators


Tweenk t1_j7eq1tx wrote

The $29B is revenue before any creator payouts, those would be listed as "cost of revenue".


gw2master t1_j7ep772 wrote

11 billion in taxes out of 75 billion profit: 14.7% ... way lower than my tax rate.


Obvious_Chapter2082 t1_j7f3dpc wrote

Effective rates for corps and individuals aren’t really comparable. At the end of the day, corporate tax returns aren’t public record, it’s impossible to know how much tax they actually pay


beatsnstuffz t1_j7frtf3 wrote

When data visualizations are harder to follow and extrapolate trends from than the data they are modeling, you've gone too far and are just masturbating at this point.


IncomeStatementGuy OP t1_j7fvjkd wrote

What do you find difficult to follow in the visualization?


beatsnstuffz t1_j7i0ksn wrote

Nothing! It's beautifully done. I just find a nice income statement easier to follow. That could easily just be from familiarity though.


ConqueredCorn t1_j7elhdl wrote

11 billion in taxes. God help us all


boshbosh92 t1_j7elzo6 wrote

wow, YouTube only accounts for 1% of their income!


Willingo t1_j7eqb4g wrote

You are looking at year over year. It made 1% more than last year.


jedberg t1_j7ern4j wrote

It's 10%, and Google Cloud is slightly less, but the cloud revenue is deceptive because it includes Gmail subscription fees.


Obvious_Chapter2082 t1_j7dpmjd wrote

Crazy to think how their income tax expense is basically a similar amount to what a single individual paid last year


I__Know__Stuff t1_j7epvcc wrote

What single individual paid $11 billion in income tax?


LucyFerAdvocate t1_j7f0ml6 wrote

He probably means Elon Musk who paid $11bn in tax, but I believe primarily capital gains tax

Edit: used to say "I don't think any substantial proportion was income tax." but IDK if capital gains is a type of income tax in the usa


Obvious_Chapter2082 t1_j7f33zm wrote

What do you mean? It was all income tax


LucyFerAdvocate t1_j7f3p85 wrote

I thought the vast majority was capital gains from liquidating shares?


Obvious_Chapter2082 t1_j7fso0j wrote

Most of it was exercising stock options, which are taxed at ordinary income rates


I__Know__Stuff t1_j7f4sve wrote

Capital gains tax is part of income tax.


LucyFerAdvocate t1_j7f73u4 wrote

Ah fair, I'm pretty sure it's not in the UK so I assumed it would be the same in the states


DataMan62 t1_j7jfpmn wrote

No. Capital gains tax is very different from ordinary income tax. The greatly reduced capital gains rate IS EXACTLY what is wrong with the American system. If you work for a living, you have to pay income taxes on it all. If you live off daddy’s inheritance, you can sit on your ass and pay less than half the rate!!!!


greenvillain t1_j7dj5fg wrote


t3e3v t1_j7do9jh wrote

Yeah that search revenue is huge. I'm sure they have something in R&D that just isnt public yet but it'll be interesting to see whether it's comparable


greenvillain t1_j7dotip wrote

Even if they come up with something comparable, you can't sell spots at the top of an indexed results page if there is no indexed results page.


GasolinePizza t1_j7f2zb4 wrote

ChatGPT isn't a search engine and isn't a replacement for one by it's very nature.

I wouldn't be surprised if the effect it has ends up being literally negligible.


black_hat_cowboy t1_j7e470g wrote

I think that too but Microsoft has a few options to consider. Either keep ChatGPT locked up and only allowed on/in their platform/product or... they license it out, including to Google, FB, etc. If I was MS and had such a promising tool, I would keep it under tight wraps.


Spandexcelly t1_j7ecyxz wrote

It was already previously open source and you can bet your bottom dollar that GOOG has developed something more sophisticated in-house. Plus, GOOG owns alot of the most useful data-sets for AI to pull from.


I-need-ur-dick-pics t1_j7dmfet wrote

Wow 11B in tax on income of 283B. That’s less than a 4% tax rate.

And here I am paying 15-20% like a schmuck. Fuck everything about this.


t3e3v t1_j7dnrmt wrote

I think its most fair to look at their profit after expenses, 11/75 B. That's still only 15% though.


ChrisFromIT t1_j7dthb9 wrote

You are making a huge mistake on mixing up income vs revenue. The reason why businesses are taxed on income(profit) is because taxes on revenue could cause a business to go out of business and it really disincentives reinvesting profits into the company which leads to more employment either directly or indirectly.


DataMan62 t1_j7jfbv3 wrote

Individuals should be able to write off expenses, too! My salary is revenue, not income!!! I have 0 income because I spend it all, just like a business tries to report on its tax return.


Obvious_Chapter2082 t1_j7dpuml wrote

It’s a 14% rate on their pre-tax income. Also, this isn’t even the income tax they actually pay, income tax expense is a different measurement


GasolinePizza t1_j7f321c wrote

^ This is why Reddit has a stereotype of being economically and financially illiterate