A GOOGLY is a ball bowled in cricket with unexpected spin. For years, Google was similarly hard to read, sharing only basic figures about its business. Alphabet, Google’s newly-formed parent company, is taking a different approach. When it reported earnings on February 1st, Alphabet disclosed for the first time how much it was spending on its “moonshot” projects, including self-driving cars, fibre internet and space exploration. In 2015 Alphabet lost around $3.6 billion on these ambitious initiatives—a large sum, but less than some had feared. Meanwhile Google, its core business, saw revenues and profits rise.

As a result, Alphabet’s shares have surged, helping it overtake Apple to become the world’s largest listed company by market value. Today Alphabet is a giant advertising company with the potential to become a giant in other sectors as well—although exactly which ones, no one is yet sure. Almost all of the $75 billion in revenue it made last year came from advertising, most of it search advertising, where Google places ads relevant to what someone is looking for online. The firm has around 70% of the global search…Continue reading

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