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Google spent billions of dollars to lay people off

Jan 31, 2024 - theverge.com
Google laid off over 12,000 employees in 2023, spending $2.1 billion on severance and other related expenses. In just the first month of 2024, the company has already spent $700 million on severance charges for another 1,000-plus layoffs. Despite these cuts, Google ended 2023 with growth in most of its core business lines, posting $86 billion in revenue for the fourth quarter, a 13% increase year over year. Google's parent company, Alphabet, revealed these figures in its fourth-quarter earnings release.

The company's primary revenue generator, its search engine business, generated $48 billion, a nearly 13% jump year over year. YouTube’s advertising revenue was $9.2 billion, a 15% increase from the previous year. Google Cloud reported a revenue of $9.19 billion, a significant boost of 25.6% year over year. However, shutting down physical office spaces due to layoffs cost Google $1.8 billion in 2023. The company anticipates more layoffs in 2024 as it continues to invest in AI and enters its "Gemini era".

Key takeaways:

  • Google spent over $2.8 billion on severance and other expenses related to layoffs of more than 13,000 employees in 2023 and early 2024.
  • Despite the layoffs, Google reported growth across most of its core business lines, including a 13% increase in revenue for the fourth quarter of 2023, totaling $86 billion.
  • Google's AI language model, Gemini, is expected to work across all of Google's core products, with an updated version, Gemini Ultra, currently in development.
  • Shutting down physical office spaces due to layoffs cost Google $1.8 billion in 2023, and more layoffs are expected in 2024 as the company continues to invest in AI.
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