Google Earning Q1 2024 [pdf]
Alphabet’s Q1 2024 results showed strong growth in Search, YouTube and Cloud, sending the stock up double digits after hours and pushing annualized revenue to around $320B. Commenters focus on the company’s first-ever dividend and a new $70B share buyback authorization, debating what this signals about Alphabet’s future growth prospects, capital allocation, and the impact on employee stock compensation. There is also extensive debate over how resilient Google’s ad-driven search business is in the face of perceived search quality decline, AI assistants, and alternative search engines, with most concluding that its scale, integration, and default positions still give it a powerful moat.
Dividend and Buybacks
- Alphabet announced its first-ever cash dividend plus authorization for an additional $70B in share repurchases (~3.6% of shares at current prices).
- Some see this as a sign of maturity or slower future growth; others note the business is still growing ~15% with ~$320B annualized revenue.
- Motives debated: tax on buybacks, inability to do large acquisitions in current regulatory climate, limited near-term capacity to invest more in chips/data centers, and desire to return cash to founders and shareholders.
- Discussion on dividends vs buybacks: buybacks are usually more tax-efficient; dividends create immediate taxable income but can stabilize the stock and provide ongoing yield.
- There is debate whether buybacks are primarily to offset RSU dilution; data from the thread suggests buybacks far exceed stock-based compensation.
Impact on Employees and RSUs
- Some claim dividends devalue unvested RSUs because share price drops by roughly the dividend amount.
- Others counter with real price moves and note the existence of “Dividend Equivalent Units” for unvested shares, making the net effect unclear.
Layoffs, Headcount, and Cost Cutting
- Headcount down by ~10,000 vs March 2023. Debate over “laid off” vs “fired” terminology and its implications for stigma and unemployment benefits.
- Consensus that layoffs are about cost reduction and profit, not cash shortages; some argue there simply weren’t productive roles for that many people.
Stock Performance and Trajectory
- Stock jumped ~13–16% after hours on earnings, dividend, and buyback news.
- One camp calls the company’s moves a “death rattle” and sees AI as a long-term threat to search.
- Others strongly reject the doom narrative, pointing to massive revenue, growth, cash, and market position.
Search Quality, AI, and Competition
- Many commenters personally use Google less, favoring LLMs (ChatGPT, Perplexity), Kagi, or Reddit for information; yet Google Search revenue still grew ~$6B / 15%.
- Several note HN is a bubble: most of the world still uses Google by default (Chrome, Android, iOS deals, school Chromebooks).
- Mixed views on search quality: complaints about “enshittification” and more ads vs defenses that Google remains excellent for high-value commercial queries.
- LLMs seen as strong for coding and research, but weaker for real-world purchases, booking, and up-to-date or precise facts; people still rely on Google for verification.
- Some foresee AI agents handling shopping and travel; others worry about scams and ad-laden AI answers.
Advertising, Attention, and Possible Manipulation
- Debate whether ad growth is driven by genuine ROI vs inflated metrics and “subprime attention” dynamics.
- One side emphasizes that advertisers monitor conversions and cut spend when ROI drops; others argue everyone in the ad chain benefits from inflated numbers and FOMO.
Ecosystem and Dependence on Google
- Even self-described non-Google users often rely indirectly on Google-funded products/standards (Firefox search deal, Android base, Chromium dominance).
- Many argue this deep integration and default status make dislodging Google from search a decades-long process, even if search as a category eventually declines.