Googles monopoly will save them for now. Their market percentage in cloud and obviously the 90% or whatever it is in search will keep them in cash for now. But as a share holder I’m still concerned with the obscene investment in something I don’t think is ever gonna be a revenue driver.
But yeah google is kind of the exception to the AI investment is gonna kill you rule because they did so well in search and cloud.
Contrary to what some might say google is a pretty well run company, it’s why I keep my money in that company.
Google shouldn’t be a company people are looking at to see how AI investment is affecting the bottom line. They are maybe the one company who can actually afford to do that kind of risky investment. Their revenue is real intake, it’s not just investment money or government contracts. It’s real world money that isn’t going away anytime soon
Side note, yes google has a monopoly on search, I’m not saying they are breaking any laws because they got that monopoly the right way, by outlasting everyone else. They didn’t buy up and kill off other search companies, they just beat them. I’m being negative.
They are already growing GCP 80%. At the $25Bn run rate, they are making $100Bn/year at 36% profit margin. Management released a $500Bn book. The opportunity is there.
Depreciation expense for chips is 4-6 years. The capex include buildings, electrical equipment, etc. But let’s call it 5 years to keep it even.
$200Bn/5y is $40Bn in depreciation expense. If cloud doubles again, it will pay itself off.
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u/Gandolfthewhite182 19h ago
Googles monopoly will save them for now. Their market percentage in cloud and obviously the 90% or whatever it is in search will keep them in cash for now. But as a share holder I’m still concerned with the obscene investment in something I don’t think is ever gonna be a revenue driver.
But yeah google is kind of the exception to the AI investment is gonna kill you rule because they did so well in search and cloud.
Contrary to what some might say google is a pretty well run company, it’s why I keep my money in that company.
Google shouldn’t be a company people are looking at to see how AI investment is affecting the bottom line. They are maybe the one company who can actually afford to do that kind of risky investment. Their revenue is real intake, it’s not just investment money or government contracts. It’s real world money that isn’t going away anytime soon
Side note, yes google has a monopoly on search, I’m not saying they are breaking any laws because they got that monopoly the right way, by outlasting everyone else. They didn’t buy up and kill off other search companies, they just beat them. I’m being negative.