Google’s attempt to take on Microsoft and Amazon in cloud computing has contributed to a 25 per cent jump in expenses and raised headcount by a fifth in the past year. “Other bets” such as self-driving car company Waymo are not yet pulling their weight, losing $US940m in the past three months. Equity investments contributed a $US1.5b loss.
It is up to advertising, which accounts for more than four-fifths of group revenue, to take the strain. At $US1.5b, Fitbit has a market value not too far from the price Google paid to buy YouTube in 2006.
Fitbit is unlikely to match the video-sharing site’s growth but, like YouTube, it would give Alphabet yet another platform for its advertising business.