Google, the tech giant synonymous with internet search, has become a household name and a driving force behind the digital age. As one of the most valuable companies in the world, it is natural to wonder about its financial prowess and the magnitude of its cash reserves.
Understanding the financial strength of a company like Google is crucial for investors who rely on its services and innovations.
By exploring Google’s cash reserves, we can gain insights into its ability to invest in cutting-edge technologies, expand its global footprint, and stay resilient in an ever-evolving market.
Let’s talk about how much cash Google actually has.
Q2 2023 Financial Earnings Release
In its Q2 2023 financial earnings report, Google reported revenue of $74.6 billion, an increase of 7% year-over-year (YoY). The report highlighted over $8 billion in revenue for Google Cloud, a 28% increase YoY. This is the second quarter in a row that Google Cloud made a profit.
In addition, Google Cloud generated a record operating income of $395 million. In Q2 2022, Google Cloud reported a loss of $590 million. It’s safe to say that in Q2 2023, Google Cloud’s operating income increased by around $1 billion YoY!
Alphabet CEO Sundar Pichai said during the Q2 earnings release call, “With Cloud, we’ve really embraced open architecture. We have embraced customers wanting to be multicloud when it makes sense for them.”
Alphabet and Google’s CFO, Ruth Porat, also said about Google Cloud, “We continue to invest aggressively while remaining focused on profitable growth.”
In addition to its positive revenue, Alphabet reported long-term debt for Q2 2023 as $13.7 billion, a 6.98% decline YoY.
As of September 26, 2023, Alphabet has $1.625 trillion in market capitalization, making it the 4th most valuable company in the world by market cap.
Google’s Cash Position
So, how much cash does Google really have? To learn how much the company has, you must first know that Google is a subsidiary of its holding company, Alphabet, Inc.
Google has $118.33 billion cash on hand, which includes cash, cash equivalents, and marketable securities.
A fun fact is that Alphabet’s cash and investments make up nearly 6% of cash held by the S&P 500!
Google Compared to Other Companies
Google has several competitors across various sectors. These competitors include Microsoft, Meta, IBM, and Apple, which recently reported the following cash on hand:
- Microsoft: $111.26 billion cash on hand
- Meta: $53.44 billion cash on hand
- IBM: $16.29 billion cash on hand
- Apple: $62.48 billion cash on hand
These numbers reflect how Google has staggeringly more cash available than its competitors! To put this into perspective, Google, or Alphabet, can use its cash to buy Boeing, which has a market cap of $118.01 billion, or S&P Global, with its $115.84 billion market cap.
Comparatively, Google can purchase Honda Motor Company twice, as it has a market cap of $57.11 billion!
What Does Google Do with Its Cash?
With all this cash, what does Google plan on doing with it? Currently, Alphabet does not pay its shareholders a dividend and is not planning to pay dividends soon. Instead, the company remains focused on innovation in a diverse range of industries and expanding its products and services.
Google is no longer just a search engine. The company reinvests its profits so it can expand into various sectors and acquire smaller innovative companies that have the potential to become its competitors in the future. This allows Google to stay ahead in all the industries they are leaders in.
Google has acquired 257 organizations as of November 2022. Its most recent acquisition was in June 2023, when Google acquired Photomath, an educational technology mobile app.
Google has an impressive cash reserve, allowing the company to innovate, expand, and maintain its competitive edge in the market. The company is committed to growth, and with its financial advantage, it positions itself to make strategic investments and acquisitions in various sectors, further solidifying its position as a tech industry leader.
Investors can take confidence in Google’s financial prowess as it continues to redefine what’s possible in the world of technology.
The image featured at the top of this post is ©IgorGolovniov/Shutterstock.com.