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Execs: Alphabet 'firing on all cylinders,' despite losses in Other Bets


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Execs: Alphabet 'firing on all cylinders,' despite losses in Other Bets

For Alphabet Inc., 2016 was a year of integrating technologies, Google CEO Sundar Pichai stressed on a Jan. 26 earnings call.

In addition to a growing focus on machine learning in the fourth quarter 2016, the company said it was looking forward to further investments in services such as YouTube Red and Google Play.

YouTube Red, the premium streaming service is now available in five countries, noted CFO Ruth Porat. "We're pleased with the success. We're still in early days. It takes a while to build a subscription business here," she said on the call.

While the company does not break out numbers for YouTube, Pichai said the company's focus on streaming video and audio content would also grow in 2017.

"We are investing a lot in developing the streaming experience. ... You will see us invest more — more countries, more original content — and we'll bring together the experiences we have, so it's even more compelling for users," the executive said.

"We are seeing traction with the rate of signups. I'm excited with the progress there," he added.

Google's Other Bets division, which houses its "moonshot" projects, continued to bleed cash, reporting an operating loss of $1.8 billion, but Porat expressed confidence at the progress of some of the efforts. She singled out the life sciences company Verily, which received an $800 million investment from the Singaporean-based fund Temasek Holdings on Jan. 26, hours before Alphabet reported its earnings.

The Waymo self-driving unit, she noted, was spun off into a standalone business in December 2016. In early January, the company announced that it would move away from producing its own car prototype to partnering with Chrysler and other car makers in its quest to put fully self-driving cars on the road.

Pichai argued that the company's growth in the fourth quarter wasn't restricted to any single area of its business. "2016 was a great year for Google, and 2017 is shaping up to be even more exciting. This quarter was about the business firing on all cylinders," he said.