Alphabet (GOOG) 25 Jul 232023 Q2 Earnings call transcript

Welcome, everyone. Thank you for standing by for the Alphabet Second Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions]

to Friedland, conference Director like speaker to now Jim today, of would hand over the your I Investor Relations. ahead. go Please

Thank Schindler and welcome and Porat. earnings us afternoon, second Ruth are Good today Philipp XXXX With conference to Pichai, Sundar quarter call. you. Alphabet's everyone

quickly I’ll Safe Harbor. Now, the cover

to Some cause regarding risks materially. statements business, involve differ number that of operations actual forward-looking and today statements of considered such make financial uncertainties and could that and results the we our performance maybe a

For the more the factors information, please refer risk Form discussed to recent most XX-K in SEC. our filed with

During to this to financial GAAP present public Relations Investor the is earnings at GAAP non-GAAP measures. included is and which in today's through our call, non-GAAP we located will measures press website of available A abc.xyz/investor. and reconciliation release, both distributed

will otherwise. Our we year-over-year on comments unless comparisons state be

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for by a Ruth, and to huge hard for our I'll everywhere customers you with and you. work echoing over close incredible continued and and trust. thank Sundar Googlers to partners to their passion their collaboration

Philipp. you, Thank

very the results, the I'm role, about I very excited into go look you to I Sundar, forward much and it. new Before thank the first, opportunity. for

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now will take your you. and Sundar, Philipp I questions. Thank

Nowak of go [Operator you. ahead. question Thank Brian from Please first Morgan Stanley. Our comes Instructions]

two. have I

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you already investments And the of as the well, positioned And that in Company, all capacity. accelerate, know including the about, we've continue to opportunity support across AI to the opportunities see Alphabet. we pace doing primary across driver as talked see just this, want the with address TPUs, we're center is we're proprietary the GPUs to as as sure we of we innovation to make well data that

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go comes from question next The UBS. of Please Lloyd ahead. Walmsley

concern think of on short that kind just can But of you what it's more of for see product out? but you the you know you term, think make useful term, seeing maybe SGE? to you And the up I maybe up can how I But playing and about questions just it's -- follow SGE are there's out scale a there that there? lot that a do how wanted guys I bit what a from of in of -- query share as guys of some monetization? the deployment up do the a kind headwind. that. terms -- a get in growth early, Is of the that longer over And sense

can give I color here. Maybe some

quality this sure obviously works a all, experience And myself, the answers clear bringing very been significantly win. which certain of focused It's first user have me, and for so users. for to there are better. clear queries are as on We a making well it's it

we definitely see I And our our are so well. right we can and metrics from users think headed it feedback in the as are in and we the direction, getting

needs inherent a exciting me these lot many user -- with what's thing that again, an of commercial that the better. opportunity needs. are to And and better, right, serve change are nature. those us to in user is gives And There that commercial journeys experiences is SGE doesn't

needs, those looking And commercial fundamentals and provide choices. they merchants exciting and that, and to an looking Users are clearly area. change. it's part as So choices, there advertisers for don't have the are of

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Post of comes next ahead. from Please The of Bank go America. question Justin

Great. Thank you.

optimization. about despite looks Cloud. ask like stabilized the really revenue growth Just It

the talk in wins seeing how And any those? or and you the total then about pipeline felt in Thank in you to quarter, client quarter could are revenues half? uptick second the you. this related about So the you AI the spending

Thanks, Justin.

It exciting and an Okay. more interest of customers conversations a is AI, are in from with lot moment they is overall definitely in there Cloud because many us. engaging on definitely

long directly view say, I when about without cloud but I win allows the term, can So on AI customers. and of as the expanding us it think short would to new bring addressable opportunity commenting Scale that term, total I we our market now. investments to

and Enterprise I earlier, into them, have over are AI, Vertex, translating it and solutions. all taking across we deep XX Search models As said of industry we Conversational

So, I'm excited about it.

us into Second, opportunity an to and cross-sell it upsell our installed gives base.

if about in with installed and So Workspace AI customers. us for than conversations. and to now, AI bring can Google to again, Google Similarly, think it in generative Duet to in deeper it's of example, Google all collaboration base AI-powered collection more go available a paying our allows X you Duet Workspace We our features. engage million back Cloud, it make

our I core finally, think differentiate us helps products. AI And

drive at For changes take incorporating profound cybersecurity, to a example, you if we there. AI deeply are look

work DeepMind Research excited, so doing long-term in all the and on directly we on AI to opportunity. I'm in well. a overall, are So as across Alphabet, are as applicable Google are And investments doing view and I Cloud Google we this and Gemini including the

about So it. excited

Maybe you. than for again the this Did Thank cloud grow one follow-up Workspaces infrastructure quarter? Great. faster Ruth.

So, we GCP above yes, -- growth rate And overall. I the that. the quarter, commented for we on cloud was second growth don't think in

Michael ahead. MoffettNathanson. next The Nathanson Please question comes go from of

macro ad about you're were quarter. talk backdrop ad are weakness in identify guys yet others step now factors of signs for digital growing you you at? What down? that linear why and If struggling Do Sundar. you one TV, and this Philipp all accelerated while for back, small real slowing, One and have slowing market? I seeing the see is think growth and Philipp, cloudy, are would can looking your the really companies are agencies, you you you

for you bit you're R&D growth? And for the over going that about us $XXX and forward change And could spend? for visiting going it's over factors you give how and years, expensive there's cadence spending any then, R&D Sundar, so a and competitive development Thanks. billion near-term on can Any research that growth I updates the guys? compete five you talk so narrative think past Can you a spent yet forward. to that

think on can the maybe comment I things. about if And R&D. how we Look, I look, think anything, -- two

thesis. research committed cycle. it that built. taking to and and in computer science are nothing the and We Company generating and which new foundation is the on always That's deep products changes And that applying building driving services innovation. value virtuous And and fundamental the is

AI realize opportunity. We are are as side on to sure mentioned, work investments, efficiency on the to we AI applies are all definitely, be doing and -- committed on to But the we both invest -- optimization Ruth the we going as to making well.

there. And overall responsibly. or comment overall on maybe philosophy let so market changes Philipp this approach that do But we're bringing so our no we there in And that all the lens I'll dynamics.

on think YouTube ROI. talked efficiency helping can't effectiveness We growth evaluating comment through vertical. I be being and and maximize And the are they're them driving the uncertainty on actually to focused but AI-powered profitability, our companies about the drive of DR do is to proven of facing, strong or out brand revenues complexity customers obviously, others, it. the solid Other retail And have solutions really the their Search continues, efficiencies, by Look, a and our on and help lot carefully side. Yes. in focus and budgets. whatever I to goal and I we tools side led called they're

I would those I are points make. the key think

of Ken Gawrelski from comes ahead. question next The Fargo. Please Wells go

Max? AI-generated And how possibly You've case talk expansions? of there. on success vertical use get creative or Could great we had to Performance in more until you ask long the Can I automated about point production? any

AI. targeting bidding, creatives Yes. advertise years, well partners AI on innovation, been pubs us advertiser it's whether core Look, advertising, this is of the experiences and frankly, foundational that we've components and a them those for a dramatically is journey allows key really component the help as at improve publisher a And as in and take scale. to question. great users through right, to

together to then this deliver care And features comes how AI meet of And for advertiser we Performance on we top quarters, at really ROI. many assets, Max build of really over demand of take this. new business on scale us They is of rest can provide GML, and advertisers. consumer seen at an heard all with the a example to it and continue we've as you goal,

of products there, bit in talked we're let Max, and AI if you And think at right perspective. I it's at asset about call our me of revamped we taking look look where in new our Performance innovation broader gen look say, prepared at a take some on whether things so announced flow you on, creation fair Automatically look a it, Assets, sense. the you my there exciting we're a asset remarks from a Studio deliver in some -- Product creation really Created I to in whether you automated path whether some to the at

of go Evercore. Please ahead. question last comes Our Mahaney from Mark

follow last Philipp. that question, I'll up on Actually, Okay.

return of AI, impact, have next do just the the the You pointed use if to your the to view where about used at could guess where improve Thanks. many most now the been think most creative, you on generative AI the would customers? creation, your it's Google? couple generative you generative you on Google advertising peel the all to out think years. you audience marketers optimization? for improve Do the just on who for -- come have going on from as will of it the of apart, Where ad campaign what's mousetrap ability a most accelerant has for AI millions advertising spend AI years material impact And your over impact the

with AI and earlier. I earlier, solve better creativity. covered new helping of And And generative this really supercharging here ahead. we're as enhance tons is make said ads I existing Look, products problems, potential really advertisers decisions,

Created in Assets, launched experience mentioned Product Google creation Ads, on. a Automatically Studio flow we in the the the example, asset For PMax. conversational so new I and

about to talk questions. very I understandably, have customers, excited When AI, they're some and

should set of is, why to of big for the launched this is a right was It unlock checklist best really to take. questions now mindset GML. to up a and of example, and with foundation what's step it steps Essentials, organizations AI, shift measurement. our at to taking our One the has Ads a Google power do is It's the AI data we customers reason announcement key of next a can which I has And take simple do products and for with with the AI AI action top success.

just are the those some examples. of So

those going those extrapolate of apart upside, a where the are forward, you see If I some lot from points examples Sundar of mentioned. the that already

before And capabilities the really in have multimodal all of mix. we is I this think

Mark. it's be Thanks, years ahead. the at of exciting early think an I looking so, to couple there, innovations And going

Thank Congratulations, Philipp. Sundar. Thanks, Ruth. you,

to Thank you. Friedland to concludes And turn further for the today. any like back for Jim remarks. that I'd conference session over question-and-answer our

Thank everyone, and us We with evening. call. forward XXXX again to you quarter for look Thanks, on speaking third good joining our have you, a today.

This participating. Thank call. conference you everyone. concludes you, for today's Thank

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