Google Cloud lost $5.61B on $13.06B revenue last year

https://www.cnbc.com/2021/02/02/google-cloud-lost-5point61-billion-on-13point06-billion-revenue-last-year.html

by etimberg • 5 years ago

45 10 5 years ago

cnbc.com

TheCoelacanth• 5 years ago

That's crazy! How are they losing so much money on such a high-margin business?

AWS and Azure are basically printing money.

influx• 5 years ago

From what I hear they are giving out sweetheart deals to large customers that aren't making money, but hey they can claim to run "X" company's cloud instances.

raiyu• 5 years ago

I’m sure they are still heavily investing in CapEx given their growth.

You have to remember that AWS had a more linear path so capex investment was spread out over a longer time line. Meanwhile Google had to rebuild all of AWS infra and capacity basically over night.

That coupled with high revenue growth leads to a large loss in the build out years. As revenue increase YoY slows down that loss will begin to narrow.

QuinnyPig• 5 years ago

Generally capex won’t hit the Cloud division explicitly; this is something else. Hmm.

hehehaha• 5 years ago

My guess is they’re giving away a lot for free. Firebase free tier is almost too generous.

anonacct382• 5 years ago

Same reason Amazon didn't show a profit for years. Just means they are continuing to spend more than they make in an effort to grow and to find those killer apps and services that will make them the dominant player.

silexia• 5 years ago

Google has a reputation issue here: no one wants to build serious products on it's platforms since it killed so many products in the past.

Legacy support sucks, but if you don't support your old products people won't trust your new ones.

anonacct382• 5 years ago

They do have a reputation issue, and it does cost them some business. There are CTOs who basically won't touch a google product in beta because there are so many things that get pulled.

That being said they are good at running vms and storage. They are really good at running kubernetes. Their network is amazing.

kevincox• 5 years ago

There are CTOs who basically won't touch a google product in beta because there are so many things that get pulled.

That is literally the point of calling it beta and why beta Google Cloud products have a different deprecation policy.

cett• 5 years ago

I would find it hard to take a CTO seriously who can't differentiate between beta and "generally available", or consumer product and enterprise cloud product.

It's a bit like saying you wouldn't use AWS because of Fire Phone.

Google Cloud lost $5.61B on $13.06B revenue last year

Related Stories