Google is a subsidiary of Alphabet Inc., a holding company created in 2015. Google revenue comes from various sources, but the vast majority is derived from advertising. The company offers advertisers three main types of advertising: search, display, and video.
As Google’s global economy has shifted in recent years, so has its business. The company is now focusing more on its cloud business and artificial intelligence (AI).
In this article, we’ll look at Google and Alphabet’s revenue, the markets they compete in, and their key acquisitions.
Key Google Statistics
Google is one of the biggest companies in the world — a feat it’s managed to achieve in a relatively short amount of time. The search engine launched in 1998 and today has a market capitalization of $1.53 trillion. Google held its initial public offering (IPO) in 2004, where shares were offered at $85.
There are over 105,000 searches on Google every second, and the company dominates the search engine industry with a 91.46% market share. Google is the most visited website on the planet, and its subsidiary, YouTube, is its runner-up.
Alphabet, which was created in 2015, is Google’s parent company. Its structure is designed to give Google more flexibility in operating its many businesses, which include:
- Google Maps: A mapping and navigation app that offers users turn-by-turn directions, traffic conditions, and local business information
- Google Play: A digital distribution platform for Android applications and games
- YouTube: A video-sharing website where users can upload, view, and share videos
- Android OS: A mobile operating system that powers millions of devices worldwide
- Google Chrome: A web browser that offers users a fast and secure way to browse the internet
- Google Drive: A cloud storage service that allows users to store and access their files from anywhere
- Pixel devices: A line of smartphones and tablets designed and manufactured by Google
- Chromebook: A line of laptop computers that run Google’s Chrome OS
- Google Workspace: A set of productivity tools that includes Gmail, Calendar, and Docs
Google has many revenue streams, but most of it comes from Google Ads — a platform that lets businesses advertise their products or services on Google and its properties.
The company is one of the “Big Five” American internet tech companies, alongside Apple, Meta (Facebook), Microsoft, and Amazon. It has offices in more than 50 countries.
Google’s Revenue Through the Years
Google’s revenue has grown exponentially since the company was founded in 1998. Google generated $400 million in revenue in 2002 and $6.1 billion by 2005. In 2010, Google’s revenue reached $29.3 billion, and by 2015, it had grown to $74.54 billion.
Google is one of the most valuable and profitable companies — a feat that has been achieved through a variety of innovative products and services. Google has made strategic acquisitions over the years that have helped it to enter new markets and grow its business.
In 2021 Alphabet’s revenue reached $256 billion, up from $181.69 billion in 2020. Google’s primary source of income is still advertising, but it’s making significant gains in cloud computing and hardware sales. Alphabet reports its earnings quarterly, and the stock is traded on the Nasdaq under the ticker “GOOGL.”
How Google’s Revenue Is Made
The primary source of Google revenue is advertising. The company sells advertising space on its search engine and websites, as well as on third-party websites through its AdSense program. The advertising income for Google makes up around 80% of the company’s total revenue.
Ads can be purchased by businesses and then placed on relevant websites, YouTube, and search results pages based on the keywords that have been selected. Companies pay Google a fee when users click on an ad. The cost per click (CPC) varies depending on the competitiveness of the keyword and the ad quality score.
Google revenue is split between website owners and content creators who display ads on their site through the AdSense program. For example, on YouTube, Google pays 55% to the video rights holder.
Google’s other revenue streams include cloud computing, hardware sales, and licensing fees. The company’s cloud business has grown rapidly, reaching $19 billion in revenue in 2021. Google’s hardware products, including the Pixel smartphone, the Chromebook laptop, and Nest smart home devices, generated a total of $19.6 billion in revenue in the same year.
Looking to the future, Google is focusing on new areas, such as artificial intelligence, self-driving cars, and internet-connected devices, to maintain its position as one of the leading technology companies in the world.
Google has always been at the forefront of innovation, and these new initiatives are just the latest examples of its commitment to staying ahead of the curve. Artificial intelligence is already beginning to transform many industries, and Google is investing heavily in this area.
Self-driving cars have the potential to revolutionize transportation, and Google is working with some of the world’s leading automakers to make this a reality. Internet-connected devices are becoming increasingly common, and Google is working to ensure that its products are compatible with this trend.
Google’s Market Share
Google is the undeniable leader in the search engine market, but it also operates in more competitive markets. Since the company has one of the most visible brands in the world and many of its services are often free for consumers, the company can be hard to compete against.
The following services dominate their respective markets:
- Gmail: Gmail is the most popular email service in the world, with 67% of people using it as their personal email account.
- Google Maps: Google Maps is the most popular mapping service, with over 25 million downloads in 2021 alone. That’s nearly double the nearest competitor, Waze GPS (a Google subsidiary).
- Google Chrome: Google Chrome has a 65.12% market share among internet browsers, making it the most popular choice.
- YouTube: YouTube dominates the competition with a market share of 75.83%, and trailing behind it is Vimeo, with 19.04%.
Google’s domination in these markets can be attributed to various factors. First, the brand name is synonymous with trust and quality. Additionally, many of Google’s services are offered for free, making it difficult for competitors to match its pricing.
Google is able to offer free services because it focuses on ads as its main source of revenue. This gives it a constant stream of income that can be used to undercut competitors or pour money into developing new products and services.
One area where Google is behind the competition is cloud computing. Google Cloud is the third-largest cloud computing company, with 10% of the market behind Amazon’s AWS (34%) and Microsoft Azure (21%).
Acquisitions have been an essential part of Google’s growth strategy. Over the years, the company has acquired many businesses, the most notable being Android (2005), YouTube (2006), and Motorola (2011).
Google’s acquisitions help the company to further its technology, and it quickly integrates its acquired companies into its existing business. This has allowed Google to capitalize on the talents and resources of the acquired companies while minimizing disruption to its operations.
The company has also been able to generate synergies between its various businesses, such as using its search engine to drive traffic to YouTube. These seamless connections help Google maintain its position as one of the world’s most successful and innovative companies.
Let’s take a deeper look at some of Google’s most significant acquisitions.
In 2005, Google acquired Android Inc. for $50 million. Android is a mobile operating system that was developed by Android Inc. This acquisition was seen as a way for Google to enter the emerging market of mobile computing.
In 2006, Google acquired YouTube for $1.65 billion. YouTube is a video-sharing website where users can upload, view, and share videos. YouTube has become one of Google’s biggest successes, with over 2.5 billion users worldwide.
In 2011, Google acquired Motorola Mobility for $12.5 billion. Motorola is a leading manufacturer of smartphones and other mobile devices. This acquisition gave Google a stronger foothold in the smartphone market and access to Motorola’s extensive patent portfolio.
In 2013, Google acquired Waze for $1.15 billion. Waze is a traffic and navigation app that uses real-time data from users to provide accurate traffic information. Google used the company’s assets to improve its map technology and keep the company out of its competitors’ hands, as Facebook and Apple were also interested in Waze.
Google Market Capitalization
Alphabet’s market cap peaked in November 2021, when it just surpassed $2 trillion. The company has seen a decline in its stock price since then, and its market cap is now at $1.59 trillion. Despite this shrink in market capitalization, Alphabet displaced Amazon in 2021 to become the third-most valuable company in the world. Google has since fallen back down to 4th place.
Apple, Saudi Aramco, and Microsoft are the highest-valued companies in the world, coming in at numbers 1, 2, and 3, respectively. The race for the top spot has been close recently, with Apple’s market cap sitting at $2.73 trillion, Saudi Aramco’s at $2.30 trillion, and Microsoft’s at $2.06 trillion.
Alphabet’s position as the fourth-most valuable company in the world is a testament to its size and scope. The company has succeeded in various businesses, from search to cloud computing. While its stock price has declined in recent years, it’s still one of the most powerful and influential companies in the world.
Google’s forecast includes more artificial intelligence and cloud computing. The company has invested heavily in those areas in recent years, believing they will be a major part of its business going forward.
Google’s entry into the cloud market has increased its business product offerings. The company is now looking to take even more market share from Amazon Web Services (AWS) and Microsoft Azure. While AWS and Azure are well-established leaders in the cloud space, Google is quickly catching up with its innovative offerings and competitive pricing.
Google is also focusing on new hardware products, like its Google Home speakers and Pixel smartphones. In general, it seems that Google is betting big on technology that will make our lives easier and more efficient.
Google’s forecast is bright. CNN reports 38 analysts backing the stock as a buy, with a further eight believing the stock will outperform expectations. There are just three holds and no sells, giving Google a “buy” rating from the investment community.
The median estimate for Google’s stock price is for it to rise by 14.16% over the next 12 months. The highest estimate comes in at 34.5%, and the lowest is –at 7.9%. Investors are clearly bullish on Google’s prospects, and the company’s forecast appears to align with this optimism.
Who Are Google’s Customers?
Most people think of Google as a search engine, but the company actually provides a wide range of products and services. While some of these are aimed at individual consumers, the majority of its revenue-generating products are targeted at businesses.
Google offers many of its services for free to consumers. Anyone who has used the internet has likely used one of Google’s most popular consumer services, such as its search engine, Gmail, YouTube, or Google Maps. Google can do this because of its advertising business, which sells ad space on its various platforms to companies.
The number of businesses using Google’s products and services is staggering. Small companies, large corporations, non-profits, and government agencies all rely on Google for email, productivity tools, website hosting, and much more.
While it would be impossible to list all of Google’s customers here, some notable examples include:
- Riot Games: The popular developer behind Fortnite uses Google’s geo-targeting tools to increase its customer base.
- McDonald’s: McDonald’s’ Hong Kong business utilizes Google Analytics to boost in-app orders by 550%.
- Samsung: Samsung uses Google Ads to promote its products to consumers worldwide. They see a 2x return on investment on their Google Ads spend.
Google Employee Facts
Jobs at Google are highly sought after. The company is known for its innovative technologies, great benefits, and innovative work environment. Google usually looks for college graduates with degrees in computer science or a related field.
Here are some interesting facts about the people who work at Google and what their work life is like:
- Google had a total of 156,500 employees in 2021.
- The average salary for a Google employee is over $122,000.
- The highest paid median salary at Alphabet is $296,000.
- Google provides its employees with free food and snacks.
- Google offers on-site child care for its employees’ children.
- Google allows its employees to bring their pets to work. There’s even a dog park at Google’s Mountain View campus.
- 90% of Google employees would recommend their employer to a friend.
These facts show that working at Google is highly desirable. The company has competitive pay and benefits, and its employees are satisfied in their positions.
Google Was Founded in 1998
Google was founded in 1998 by Sergey Brin and Larry Page, two Ph.D. students at Stanford University in California. Together, they developed a new way to organize information on the web, which they called “Google.”
Google has since become one of the world’s most popular websites, used by billions of people every day. Alphabet’s current CEO is Sundar Pichai, who took over the role from Larry Page in 2015.
Larry Page and Sergey Brin registered the google.com domain name in September 1997, one year before the site went live. The name “Google” was a play on the word “googol,” a math term for the number one, followed by 100 zeroes.
The duo initially ran the company out of Susan Wojcicki’s garage. Wojcicki would eventually be appointed the CEO of YouTube, a position she still holds today. One of the company’s earliest investors was another tech entrepreneur, Jeff Bezos. He is the founder of Amazon, one of the “Big Five” American tech companies.
Who Are Google’s Competitors?
Google has been a dominant force in the tech industry for many years, but that doesn’t mean it doesn’t have competitors. In fact, quite a few companies are gunning for Google’s spot at the top.
Due to the sheer number of industries that Google is active in, it has a lot of different competitors. In the search engine realm, its biggest competitor is Microsoft’s Bing. While Bing doesn’t have the same market share as Google, it is the main competitor.
Google has to compete more directly in other industries to capture its market share. In the email market, Google’s Gmail is up against Microsoft’s Outlook.com and Yahoo! Mail. Gmail has grown to become the most popular personal email service, but many users choose to use other email clients to access their accounts.
YouTube, Google’s video-sharing platform, is also a big draw for the company. While YouTube has many users, it faces competition from many different fronts. It competes against Vimeo, DLive, and Daily Motion for video hosting. For users’ attention, it is up against TikTok, Netflix, Hulu, Amazon Prime Video, and social media websites.
Cloud computing is one of Google’s fastest-growing industries, but it faces intense competition from Microsoft Azure and Amazon’s AWS. Google is quickly gaining market share, but Microsoft and Amazon both remain ahead of it.
Google has been developing autonomous vehicles for many years and is now one of the leading companies in the field. However, it faces strong competition from car manufacturers, including Tesla and Nissan.
Interesting Google Facts
Google’s headquarters are called the Googleplex. The Googleplex is located in Mountain View, California, the heart of Silicon Valley. The word “Googleplex” is a misspelling of “googolplex,” which is a 1 followed by a googol of zeros.
An ex-employee of Google managed to acquire the google.com domain when it was mistakenly left unregistered. The employee registered the domain for himself, and Google offered $6006.13 to regain the domain.
Google removed its “I’m Feeling Lucky” search feature, as it bypassed advertising, costing the company up to $110 million each year. Users could click the button and be taken to the first search result rather than be presented with the standard list of results.
Since 1998, Google has released special Google Doodles to celebrate important events, people, and anniversaries. Some of the most famous Doodles include:
- An interactive search for Pac-Man on the 30th anniversary of the game
- A playable guitar on musician Les Paul’s 96th birthday
- A tribute to actor Charlie Chaplin on what would have been his 122nd birthday
Google is a highly successful company that has changed how we interact with the internet. Many of its products, including Google Adsense, Gmail, and Google Analytics, work with multiple applications, including WordPress. Its tools can be used to monetize blogs and websites and track user engagement.
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