Alphabet Inc 10-Q for FY2024 Q2

Alphabet Inc. (GOOGL)

10-Q 2024-07-24 For: 2024-06-30

Added on April 01, 2026

About this 10-Q

Alphabet Inc filed this 10-Q on July 24, 2024, covering the quarter ended June 30, 2024 (FY2024 Q2).

Headline figures

Quarter ended June 30, 2024, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $84.74B; up 13.6% from $74.6B a year earlier
Net income: $23.62B; up 28.6% from net income of $18.37B a year earlier
Diluted EPS: $1.89; up 31.3% from $1.44 a year earlier

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Delaware			61-1767919
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification Number)


Securities registered pursuant to Section 12(b) of the Act:
Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A Common Stock, $0.001 par value	GOOGL	Nasdaq Stock Market LLC
		(Nasdaq Global Select Market)
Class C Capital Stock, $0.001 par value	GOOG	Nasdaq Stock Market LLC
		(Nasdaq Global Select Market)


		Page No.
Note About Forward-Looking Statements		3

PART I. FINANCIAL INFORMATION
Item 1	Financial Statements	5
	Consolidated Balance Sheets - December 31, 2023 and June 30, 2024	5
	Consolidated Statements of Income - Three and Six Months Ended June 30, 2023 and 2024	6
	Consolidated Statements of Comprehensive Income - Three and Six Months Ended June 30, 2023 and 2024	7
	Consolidated Statements of Stockholders' Equity - Three and Six Months Ended June 30, 2023 and 2024	8
	Consolidated Statements of Cash Flows - Six Months Ended June 30, 2023 and 2024	10
	Notes to Consolidated Financial Statements	11
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	33
Item 3	Quantitative and Qualitative Disclosures About Market Risk	47
Item 4	Controls and Procedures	47

PART II. OTHER INFORMATION
Item 1	Legal Proceedings	49
Item 1A	Risk Factors	49
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	49
Item 5	Other Information	50
Item 6	Exhibits	51
Signatures		52


	As of December 31, 2023		As of June 30, 2024
			(unaudited)
Assets
Current assets:
Cash and cash equivalents	$	24,048	$	27,225
Marketable securities	86,868		73,500
Total cash, cash equivalents, and marketable securities	110,916		100,725
Accounts receivable, net	47,964		47,087
Other current assets	12,650		14,183
Total current assets	171,530		161,995
Non-marketable securities	31,008		34,172
Deferred income taxes	12,169		14,958
Property and equipment, net	134,345		151,155
Operating lease assets	14,091		13,606
Goodwill	29,198		29,185
Other non-current assets	10,051		9,699
Total assets	$	402,392	$	414,770
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	7,493	$	6,092

Accrued compensation and benefits	15,140		11,373
Accrued expenses and other current liabilities	46,168		47,298
Accrued revenue share	8,876		8,899
Deferred revenue	4,137		4,251
Total current liabilities	81,814		77,913
Long-term debt	13,253		13,238
Deferred revenue, non-current	911		985
Income taxes payable, non-current	8,474		7,703
Deferred income taxes	485		717
Operating lease liabilities	12,460		11,708
Other long-term liabilities	1,616		1,753
Total liabilities	119,013		114,017
Commitments and Contingencies (Note 8)
Stockholders’ equity:
Preferred stock, $0.001 par value per share, 100 shares authorized; no shares issued and outstanding	0		0
Class A, Class B, and Class C stock and additional paid-in capital, $0.001 par value per share: 300,000 shares authorized (Class A 180,000, Class B 60,000, Class C 60,000); 12,460 (Class A 5,899, Class B 870, Class C 5,691) and 12,322 (Class A 5,860, Class B 866, Class C 5,596) shares issued and outstanding	76,534		79,732
Accumulated other comprehensive income (loss)	(4,402)		(5,012)
Retained earnings	211,247		226,033
Total stockholders’ equity	283,379		300,753
Total liabilities and stockholders’ equity	$	402,392	$	414,770


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2023		2024		2023		2024
Revenues	$	74,604	$	84,742	$	144,391	$	165,281
Costs and expenses:
Cost of revenues	31,916		35,507		62,528		69,219
Research and development	10,588		11,860		22,056		23,763
Sales and marketing	6,781		6,792		13,314		13,218
General and administrative	3,481		3,158		7,240		6,184
Total costs and expenses	52,766		57,317		105,138		112,384
Income from operations	21,838		27,425		39,253		52,897
Other income (expense), net	65		126		855		2,969
Income before income taxes	21,903		27,551		40,108		55,866
Provision for income taxes	3,535		3,932		6,689		8,585
Net income	$	18,368	$	23,619	$	33,419	$	47,281




Basic net income per share (Note 10)	$	1.45	$	1.91	$	2.63	$	3.82









Diluted net income per share (Note 10)	$	1.44	$	1.89	$	2.61	$	3.78


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


	Three Months Ended June 30, 2023
	Class A, Class B, Class C Stock and Additional Paid-In Capital			Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Total Stockholders’ Equity
	Shares	Amount
Balance as of March 31, 2023	12,722	$	70,269	$	(6,000)	$	196,625	$	260,894
Stock issued	38	0		0		0		0
Stock-based compensation expense	0	5,815		0		0		5,815
Tax withholding related to vesting of restricted stock units and other	0	(2,831)		0		0		(2,831)
Repurchases of stock	(131)	(1,005)		0		(14,109)		(15,114)
Net income	0	0		0		18,368		18,368
Other comprehensive income (loss)	0	0		9		0		9
Balance as of June 30, 2023	12,629	$	72,248	$	(5,991)	$	200,884	$	267,141


	Six Months Ended June 30, 2023
	Class A, Class B, Class C Stock and Additional Paid-In Capital			Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Total Stockholders’ Equity
	Shares	Amount
Balance as of December 31, 2022	12,849	$	68,184	$	(7,603)	$	195,563	$	256,144
Stock issued	68	0		0		0		0
Stock-based compensation expense	0	11,128		0		0		11,128
Tax withholding related to vesting of restricted stock units and other	0	(4,924)		0		0		(4,924)
Repurchases of stock	(288)	(2,140)		0		(28,098)		(30,238)
Net income	0	0		0		33,419		33,419
Other comprehensive income (loss)	0	0		1,612		0		1,612
Balance as of June 30, 2023	12,629	$	72,248	$	(5,991)	$	200,884	$	267,141


	Three Months Ended June 30, 2024
	Class A, Class B, Class C Stock and Additional Paid-In Capital			Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Total Stockholders’ Equity
	Shares	Amount
Balance as of March 31, 2024	12,381	$	77,913	$	(4,839)	$	219,770	$	292,844
Stock issued	33	0		0		0		0
Stock-based compensation expense	0	5,908		0		0		5,908
Tax withholding related to vesting of restricted stock units and other	0	(3,304)		0		0		(3,304)
Repurchases of stock	(92)	(789)		0		(14,809)		(15,598)
Dividends and dividend equivalents declared ($0.20 per share)	0	4		0		(2,547)		(2,543)
Net income	0	0		0		23,619		23,619
Other comprehensive income (loss)	0	0		(173)		0		(173)
Balance as of June 30, 2024	12,322	$	79,732	$	(5,012)	$	226,033	$	300,753


	Six Months Ended June 30, 2024
	Class A, Class B, Class C Stock and Additional Paid-In Capital			Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Total Stockholders’ Equity
	Shares	Amount
Balance as of December 31, 2023	12,460	$	76,534	$	(4,402)	$	211,247	$	283,379
Stock issued	65	0		0		0		0
Stock-based compensation expense	0	11,201		0		0		11,201
Tax withholding related to vesting of restricted stock units and other	0	(6,300)		0		0		(6,300)
Repurchases of stock	(203)	(1,707)		0		(29,948)		(31,655)
Dividends and dividend equivalents declared ($0.20 per share)	0	4		0		(2,547)		(2,543)
Net income	0	0		0		47,281		47,281
Other comprehensive income (loss)	0	0		(610)		0		(610)
Balance as of June 30, 2024	12,322	$	79,732	$	(5,012)	$	226,033	$	300,753


		As of December 31, 2023
	Fair Value Hierarchy	Adjusted Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Cash and Cash Equivalents		Marketable Securities
Fair value changes recorded in other comprehensive income
Time deposits	Level 2	$	2,628	$	0	$	0	$	2,628	$	2,628	$	0
Government bonds	Level 2	38,106		233		(679)		37,660		1,993		35,667
Corporate debt securities	Level 2	22,457		112		(637)		21,932		0		21,932
Mortgage-backed and asset-backed securities	Level 2	17,243		88		(634)		16,697		0		16,697
Total investments with fair value change reflected in other comprehensive income(1)		$	80,434	$	433	$	(1,950)	$	78,917	$	4,621	$	74,296
Fair value adjustments recorded in net income
Money market funds	Level 1							$	6,480	$	6,480	$	0
Current marketable equity securities(2)	Level 1							4,282		0		4,282
Mutual funds	Level 2							311		0		311
Government bonds	Level 2							1,952		347		1,605
Corporate debt securities	Level 2							3,782		91		3,691
Mortgage-backed and asset-backed securities	Level 2							2,683		0		2,683
Total investments with fair value change recorded in net income								$	19,490	$	6,918	$	12,572
Cash								0		12,509		0
Total		$	80,434	$	433	$	(1,950)	$	98,407	$	24,048	$	86,868


		As of June 30, 2024
	Fair Value Hierarchy	Adjusted Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Cash and Cash Equivalents		Marketable Securities
Fair value changes recorded in other comprehensive income
Time deposits	Level 2	$	2,784	$	0	$	0	$	2,784	$	2,784	$	0
Government bonds	Level 2	33,002		60		(447)		32,615		5,268		27,347
Corporate debt securities	Level 2	18,856		40		(437)		18,459		0		18,459
Mortgage-backed and asset-backed securities	Level 2	14,806		30		(578)		14,258		0		14,258
Total investments with fair value change reflected in other comprehensive income(1)		$	69,448	$	130	$	(1,462)	$	68,116	$	8,052	$	60,064
Fair value adjustments recorded in net income
Money market funds	Level 1							$	7,061	$	7,061	$	0
Current marketable equity securities(2)	Level 1							4,683		0		4,683
Mutual funds	Level 2							276		0		276
Government bonds	Level 2							2,162		152		2,010
Corporate debt securities	Level 2							3,694		89		3,605
Mortgage-backed and asset-backed securities	Level 2							2,862		0		2,862
Total investments with fair value change recorded in net income								$	20,738	$	7,302	$	13,436
Cash								0		11,871		0
Total		$	69,448	$	130	$	(1,462)	$	88,854	$	27,225	$	73,500


	As of June 30, 2024
Due in 1 year or less	$	7,234
Due in 1 year through 5 years	36,666
Due in 5 years through 10 years	11,977
Due after 10 years	12,664
Total	$	68,541


	As of December 31, 2023
	Less than 12 Months				12 Months or Greater				Total
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Government bonds	$	1,456	$	(22)	$	13,897	$	(657)	$	15,353	$	(679)
Corporate debt securities	827		(5)		15,367		(592)		16,194		(597)
Mortgage-backed and asset-backed securities	2,945		(26)		7,916		(608)		10,861		(634)
Total	$	5,228	$	(53)	$	37,180	$	(1,857)	$	42,408	$	(1,910)


Table of Contents			Alphabet Inc.


Table of Contents			Alphabet Inc.


Table of Contents			Alphabet Inc.


Table of Contents			Alphabet Inc.


	As of December 31, 2023						As of June 30, 2024
	Marketable Equity Securities		Non-Marketable Equity Securities		Total		Marketable Equity Securities		Non-Marketable Equity Securities		Total
Total initial cost	$	5,418	$	17,616	$	23,034	$	5,107	$	19,219	$	24,326
Cumulative net gain (loss)(1)	555		11,150		11,705		128		12,370		12,498
Carrying value	$	5,973	$	28,766	$	34,739	$	5,235	$	31,589	$	36,824


	Equity Securities Sold
	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2023		2024		2023		2024
Total sale price	$	427	$	583	$	739	$	1,673
Total initial cost	156		303		367		964
Cumulative net gains (losses)	$	271	$	280	$	372	$	709


	As of December 31, 2023		As of June 30, 2024
Derivatives designated as hedging instruments:
Foreign exchange contracts
Cash flow hedges	$	18,039	$	18,803
Fair value hedges	$	2,065	$	1,649
Net investment hedges	$	9,472	$	9,355
Derivatives not designated as hedging instruments:
Foreign exchange contracts	$	39,722	$	42,006
Other contracts	$	10,818	$	11,542


	As of December 31, 2023				As of June 30, 2024
	Assets(1)		Liabilities(2)		Assets(1)		Liabilities(2)
Derivatives designated as hedging instruments:
Foreign exchange contracts	$	205	$	242	$	365	$	22

Derivatives not designated as hedging instruments:
Foreign exchange contracts	134		156		26		171
Other contracts	114		47		172		26
Total derivatives not designated as hedging instruments	248		203		198		197
Total	$	453	$	445	$	563	$	219


	Gains (Losses) Recognized in Income
	Three Months Ended June 30,
	2023				2024
	Revenues		Other income (expense), net		Revenues		Other income (expense), net
Total amounts in the Consolidated Statements of Income	$	74,604	$	65	$	84,742	$	126

Effect of cash flow hedges:
Foreign exchange contracts
Amount reclassified from AOCI to income	$	(2)	$	0	$	106	$	0
Amount excluded from the assessment of effectiveness (amortized)	6		0		(4)		0
Effect of fair value hedges:
Foreign exchange contracts
Hedged items	0		22		0		(9)
Derivatives designated as hedging instruments	0		(22)		0		9
Amount excluded from the assessment of effectiveness	0		5		0		3
Effect of net investment hedges:
Foreign exchange contracts
Amount excluded from the assessment of effectiveness	0		72		0		31
Effect of non designated hedges:
Foreign exchange contracts	0		124		0		(22)
Other contracts	0		(4)		0		26
Total gains (losses)	$	4	$	197	$	102	$	38


	Gains (Losses) Recognized in Income
	Six Months Ended June 30,
	2023				2024
	Revenues		Other income (expense), net		Revenues		Other income (expense), net
Total amounts in the Consolidated Statements of Income	$	144,391	$	855	$	165,281	$	2,969

Effect of cash flow hedges:
Foreign exchange contracts
Amount of gains (losses) reclassified from AOCI to income	$	86	$	0	$	180	$	0
Amount excluded from the assessment of effectiveness (amortized)	2		0		(6)		0
Effect of fair value hedges:
Foreign exchange contracts
Hedged items	0		54		0		(25)
Derivatives designated as hedging instruments	0		(54)		0		24
Amount excluded from the assessment of effectiveness	0		10		0		6
Effect of net investment hedges:
Foreign exchange contracts
Amount excluded from the assessment of effectiveness	0		123		0		67
Effect of non designated hedges:
Foreign exchange contracts	0		154		0		(1)
Other contracts	0		(1)		0		102
Total gains (losses)	$	88	$	286	$	174	$	173


	As of December 31, 2023
							Gross Amounts Not Offset in the Consolidated Balance Sheets, but Have Legal Rights to Offset
	Gross Amounts Recognized		Gross Amounts Offset in the Consolidated Balance Sheets		Net Amounts Presented in the Consolidated Balance Sheets		Financial Instruments(1)		Cash and Non-Cash Collateral Received or Pledged		Net Amounts
Derivatives assets	$	535	$	(82)	$	453	$	(213)	$	(75)	$	165
Derivatives liabilities	$	527	$	(82)	$	445	$	(213)	$	(16)	$	216


	Maturity	Coupon Rate	Effective Interest Rate	As of December 31, 2023		As of June 30, 2024
Debt
2016-2020 Notes issuances	2025 - 2060	0.45% - 2.25%	0.57% - 2.33%	$	13,000	$	12,000
Future finance lease payments, net and other debt (1)				1,746		2,280
Total debt				14,746		14,280
Unamortized discount and debt issuance costs				(130)		(124)
Less: Current portion of long-term notes(2)				(1,000)		0
Less: Current portion of future finance lease payments, net and other current debt(1)(2)				(363)		(918)
Total long-term debt				$	13,253	$	13,238


	As of December 31, 2023		As of June 30, 2024
Land and buildings	$	74,083	$	78,641
Information technology assets	80,594		91,994
Construction in progress	35,229		40,742
Leasehold improvements	11,425		12,010
Furniture and fixtures	472		584
Property and equipment, gross	201,803		223,971
Less: accumulated depreciation	(67,458)		(72,816)
Property and equipment, net	$	134,345	$	151,155


	As of December 31, 2023		As of June 30, 2024
European Commission fines(1)	$	9,525	$	9,376
Accrued purchases of property and equipment	4,679		5,364
Accrued customer liabilities	4,140		3,871
Current operating lease liabilities	2,791		2,855
Income taxes payable, net	2,748		3,297
Other accrued expenses and current liabilities	22,285		22,535
Accrued expenses and other current liabilities	$	46,168	$	47,298


	Foreign Currency Translation Adjustments		Unrealized Gains (Losses) on Available-for-Sale Investments		Unrealized Gains (Losses) on Cash Flow Hedges		Total
Balance as of December 31, 2022	$	(4,142)	$	(3,477)	$	16	$	(7,603)
Other comprehensive income (loss) before reclassifications	831		296		(50)		1,077
Amounts excluded from the assessment of hedge effectiveness recorded in AOCI	0		0		127		127
Amounts reclassified from AOCI	0		490		(82)		408
Other comprehensive income (loss)	831		786		(5)		1,612
Balance as of June 30, 2023	$	(3,311)	$	(2,691)	$	11	$	(5,991)


	Google Services		Google Cloud		Other Bets		Total
Balance as of December 31, 2023	$	21,118	$	7,199	$	881	$	29,198
Acquisitions	31		0		0		31
Foreign currency translation and other adjustments	(39)		(3)		(2)		(44)
Balance as of June 30, 2024	$	21,110	$	7,196	$	879	$	29,185


	Number of Shares	Weighted- Average Grant-Date Fair Value
Unvested as of December 31, 2023	338	$	104.93
Granted	169	$	135.64
Vested	(101)	$	109.05
Forfeited/canceled	(19)	$	109.92
Unvested as of June 30, 2024	387	$	117.01


	As of December 31, 2023		As of June 30, 2024
Long-lived assets:
United States	$	110,053	$	122,463
International	38,383		42,298
Total long-lived assets	$	148,436	$	164,761


					Three Months Ended June 30, 2024
									% Change from Prior Period
	Three Months Ended June 30,				Less FX Effect		Constant Currency Revenues		As Reported		Less Hedging Effect		Less FX Effect		Constant Currency Revenues
	2023		2024
United States	$	35,073	$	41,196	$	0	$	41,196	17	%			0	%	17	%
EMEA	22,289		24,683		(367)		25,050		11	%			(1)	%	12	%
APAC	12,728		13,823		(595)		14,418		9	%			(4)	%	13	%
Other Americas	4,511		4,938		(305)		5,243		9	%			(7)	%	16	%
Revenues, excluding hedging effect	74,601		84,640		(1,267)		85,907		13	%			(2)	%	15	%
Hedging gains (losses)	3		102
Total revenues(1)	$	74,604	$	84,742			$	85,907	14	%	1	%	(2)	%	15	%


Period	Total Number of Class A Shares Purchased (in thousands) (1)	Total Number of Class C Shares Purchased (in thousands) (1)	Average Price Paid per Class A Share (2)		Average Price Paid per Class C Share (2)		Total Number of Shares Purchased as Part of Publicly Announced Programs (in thousands) (1)	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (in millions)
April 1 - 30	8,101	28,903	$	159.68	$	160.18	37,004	$	84,523
May 1 - 31	6,380	23,177	$	172.74	$	174.14	29,557	$	79,419
June 1 - 30	4,849	20,397	$	179.38	$	179.75	25,246	$	74,904
Total	19,330	72,477					91,807



♦			Indicates management compensatory plan, contract, or arrangement.
*			Filed herewith.
‡			Furnished herewith.


		ALPHABET INC.
July 23, 2024	By:	/s/ RUTH M. PORAT
		Ruth M. Porat
		President and Chief Investment Officer; Chief Financial Officer


		ALPHABET INC.
July 23, 2024	By:	/s/ AMIE THUENER O'TOOLE
		Amie Thuener O'Toole
		Vice President, Corporate Controller and Principal Accounting Officer


Date: July 23, 2024						/S/ SUNDAR PICHAI
						Sundar Pichai
						Chief Executive Officer (Principal Executive Officer)