But, yeah, I would say, at this point, they are losing the narrative in the court of public opinion at this point. We fully expect them to continue to roll out products and continue to demonstrate more and more value that these products can bring, and ultimately revenue they can drive longer term. What I can say for Google is that, you know, they continue to be relatively unpromotional, I would say, about their AI efforts, and particularly their generative AI efforts, which obviously competes with ChatGPT. So I can't really speak for that stock in particular. And so all of that considered, did the conversation kind of net out who would be a clear winner or if there would be a generational shift that also meant a shift in the revenue that these companies see as a matter of search?īRAD ERICKSON: Yeah, I mean, one thing I would note, I don't cover Microsoft. And then for Microsoft, kind of an early victory lap, if you will, but saying that they're going to continue to build off of it. Seemed like a great deal of both calls really focused in on investments in generative AI and what that could do in Alphabet's case for what still makes up the lion's share of its business in advertising revenue driven by search and other subsidiaries. And their businesses are actually running fairly well. So, yeah, Google's kind of been a laggard in terms of showing more pronounced expense reductions here lately.īut, you know, they are doing what they can. They expect revenue to grow faster than expenses, but didn't give a lot of detail there, and certainly didn't do anything on the nature of, you know, cutting incremental heads, for example, of employees or anything of that nature. That compared to what they had said last quarter, where they had said it would be flat.Īnd then on the operating expense lines, you know, they kind of gave very vague commentary. What they said was they're actually going to see a little bit of an increase in their CapEx year over year this year. If anything, it was kind of a marginal negative. They didn't give us a lot on the expense line. How do you think Alphabet is doing on that front?īRAD ERICKSON: Yeah, I think fortunately for them, the top line was relatively good, probably a little better than feared, even, last night. But of course, the other half of it is what's been going on more broadly in tech on the expense line. Of course, part of the question for Alphabet was demand. Joining me now to discuss the resiliency of tech as companies continue to focus on efficiency is Brad Erickson, RBC Capital internet equity analyst. And that maybe was part of the picture that helped ease worries among investors, who were expecting the worst due to macro headwinds and the resulting drop in advertising spend. He made those comments on Alphabet's first quarter call. As a lot of companies have talked about the year of efficiency or austerity, whatever you want to call it, Alphabet CEO Sundar Pichai talking about efforts underway for multiyear savings. RBC Capital Markets Equity Analyst Brad Erickson joins Yahoo Finance Live to discuss key takeaways from Alphabet earnings, investor sentiment, the resiliency of tech despite macro headwinds, AI, and the expectations for Meta earnings.
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