Alphabet Inc. Hits Trillion Dollar Milestone

Alphabet Inc. Hits Trillion Dollar Milestone

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Alphabet Inc is a holding company that was founded by Lawrence E. Page and Sergey Mikhaylovich on October 2, 2015. Holding companies own other companies’ outstanding stock, and so acquires and operates different companies.

Alphabet doesn’t produce goods or services itself, but owns shares of other companies in order to form a corporate group.

It is considered to be Google’s parent company, and operates through the Google and Other Bets segments. The Google segment includes internet products such as Ads, Android, Chrome, Commerce, Google Cloud, Google Maps, Google Play, Hardware, Search and YouTube.

The Other Bets segment includes businesses Access, Calico, CapitalG, GV, Nest, Verily, Waymo and X.

What makes this particular holding company special is that it recently hit a marketing milestone that few ever reach.

Alphabet Reaches Market Valuation of $1 Trillion

For the first time ever, Alphabet hit the $1 trillion mark, when shares of the company gained as much as 0.8%.

Only Three Other U.S. Companies Have Ever Achieved This Milestone

Alphabet has now joined the ranks of other U.S. companies Apple, Microsoft and Amazon.

Apple was the first U.S. company to hit $1 trillion in 2018, followed later that year by Amazon, and Microsoft hit the $1 trillion mark in April 2019. Amazon has since dropped below $1 trillion.

The first company ever to hit a $1 trillion market cap was PetroChina in 2007.

A Change in Leadership Came Before the Record Was Achieved

This record came about not long after there was a leadership change and Sundar Pichai became CEO, after co-founders Larry Page and Sergey Brin announced that they would relinquish control of Alphabet.

Wall Street Analysts Affected the Record

Wall Street analysts were in favor of the change in leadership, and one in particular, Michael Levine of Pivotal Research increased his price target and upgraded the stock to “buy” from “hold”.

Stock Gains and Record Were Reached Despite Online Privacy and Antitrust Regulation Challenges

Alphabet and other technology companies continue to lead in the U.S. market and economy, despite concerns and calls for online privacy and antitrust regulations that have been causing some challenges for technology companies.

Alphabet to Report Fourth-Quarter Earnings on February 3rd

Wall Street analysts are expecting this report to show a revenue of $46.9 billion, which represents a year-over-year uptick of almost 20 percent.

Google Cloud, a competitor for Amazon and Microsoft’s cloud services has been causing some enthusiasm.

While Google Cloud is still behind its competitors, there is an expectation that the business is will go from $8 billion in cloud revenue to nearly $17 billion in 2021.

In the first report since Pichai became CEO, YouTube showed $15 billion in annual ad revenue, a 35.8% growth over the year before. And there is the non-advertising revenue of $3 billion a year for subscriptions to its premium and TV services.

Hot on the heels of Alphabet, the next company expected to hit the $1 trillion market cap is Facebook, which, at the latest recording, was at about $620 billion.