Waymo, as part of Alphabet’s “Other Bets” division, is a key player in the autonomous vehicle space but has been operating at a financial loss. In Q2 2023, Alphabet reported that its “Other Bets” division, which includes Waymo, generated $285 million in revenue but incurred an operating loss of $813 million. This loss is, however, an improvement from Q2 2022, when the operating loss was over $1.34 billion. Over the last five years, “Other Bets” has generated about $3 billion in cumulative revenue but incurred $20 billion in operating losses, with Waymo contributing significantly to these figures  .

Alphabet recently committed an additional $5 billion to Waymo, indicating ongoing support despite financial challenges. This investment comes as Waymo pivots to focus more on its robotaxi business, scaling services in cities like San Francisco, Los Angeles, and Phoenix, while shutting down its trucking division, Waymo Via  .

Financially, Waymo remains a long-term bet for Alphabet, with analysts and investors hoping for more disciplined management to reduce losses. The decision to focus on scaling Waymo One, the robotaxi service, and possibly licensing its self-driving technology could offer new revenue streams in the future  .

For detailed financial reports and earnings statements, Alphabet publishes all relevant data on its ** **.

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Waymo, as a subsidiary of Alphabet, falls under the “Other Bets” category in Alphabet’s financial reports. Here’s a breakdown of how the financials work for Waymo and its broader relationship within Alphabet:

1. Alphabet’s Financial Reporting:

• Alphabet breaks down its financial results into two main categories:

• Google Services: Includes Google Search, Ads, YouTube, and other core services.

• Google Cloud: Cloud services for businesses.

• Other Bets: This is where Waymo falls, along with other experimental projects like Verily (life sciences) and Wing (drone delivery).

2. Revenue of “Other Bets”:

• The “Other Bets” category, including Waymo, has relatively low revenue compared to Google’s core businesses.

• In recent years, “Other Bets” have generated around $1-2 billion in annual revenue, a small fraction compared to Google’s overall revenue, which is in the hundreds of billions.

• Most of the revenue in “Other Bets” is reinvested into further research, development, and scaling the businesses.

3. Expenses and Losses:

• “Other Bets” are generally not profitable yet. In fact, they often report operating losses because they are in the investment and growth phase.

• In 2023, “Other Bets” had an operating loss of approximately $6 billion annually. Waymo, as one of the biggest “Other Bets,” is a major contributor to these losses due to the high costs of developing autonomous driving technology.

4. Waymo’s Funding and Investment:

• In 2020, Waymo raised external funding for the first time, securing over $3 billion from outside investors like Silver Lake, Andreessen Horowitz, and the Canada Pension Plan Investment Board. This indicated that Alphabet was opening up Waymo to external financial participation while still maintaining significant ownership.

• Waymo’s development is capital-intensive, with major investments in research, testing, hardware, software, and fleet operations.

5. Waymo’s Valuation:

• As of 2023, Waymo’s estimated valuation is in the range of $30-50 billion, although this fluctuates based on investor sentiment and progress in the self-driving sector. This valuation is derived from the technology’s potential future value in autonomous transportation and logistics, rather than current profitability.

6. Revenue Sources for Waymo:

• Waymo One (ride-hailing): Currently operates in select cities like Phoenix, offering fully autonomous rides. Revenue here is modest as the service is still expanding.

• Waymo Via (trucking and logistics): A growing area of focus, Waymo aims to partner with logistics companies and deploy self-driving trucks.

• Licensing and Partnerships: Waymo also pursues partnerships with automakers and logistics firms, licensing its autonomous driving technology.

7. Profitability Outlook:

• Waymo is still in a pre-profit stage as of 2023-2024. While it’s making strides in commercialization, such as expanding its autonomous ride-hailing service and testing autonomous trucking, full-scale profitability is likely several years away.

• Alphabet continues to support Waymo with large financial backing, betting that its autonomous technology will eventually transform both personal and commercial transportation.

Overall, while Waymo doesn’t yet generate significant revenue or profit, it is a key long-term bet for Alphabet, supported by large financial investments aimed at leading the autonomous vehicle revolution.

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Waymo operates under Alphabet Inc., which is the parent company of both Google and Waymo, among many other subsidiaries. Here’s a simplified breakdown of Alphabet’s corporate structure relevant to Waymo:

1. Alphabet Inc. (Parent Company)

• CEO: Sundar Pichai (also CEO of Google)

• Alphabet oversees various businesses, including Google and its “Other Bets,” such as Waymo.

2. Google LLC (Largest Subsidiary of Alphabet)

• Core Businesses: Search, YouTube, Ads, Cloud, Android, Chrome, Google Maps, etc.

• Google generates most of Alphabet’s revenue but operates separately from the “Other Bets” division.

3. Waymo (Subsidiary of Alphabet, under “Other Bets”)

• CEO: Dmitri Dolgov and Tekedra Mawakana (Co-CEOs as of recent updates)

• Focus: Autonomous driving technology and self-driving vehicles.

• Key Projects:

• Waymo One: The autonomous ride-hailing service, operational in certain cities.

• Waymo Via: Focuses on autonomous trucking and delivery services.

4. Other Bets (Alphabet’s Experimental and Emerging Companies)

• Waymo is part of the “Other Bets” segment, which includes other experimental and forward-looking ventures, such as:

• Verily (Life Sciences)

• Calico (Longevity and Health)

• Wing (Drone Delivery)

• Loon (Internet balloons, though now discontinued)

Reporting and Governance:

• Waymo and other “Other Bets” report their financial results separately from Google’s core businesses.

• Ruth Porat, as the CFO of Alphabet, oversees the financial performance of both Google and the “Other Bets.”

• Waymo and the other subsidiaries within “Other Bets” are designed to be more speculative and less focused on immediate profitability compared to Google.

In this structure, Waymo is autonomous in terms of operations but benefits from the shared resources and financial backing of Alphabet. The company has its leadership team but coordinates with Alphabet at a high strategic level.

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Waymo is a subsidiary of Alphabet Inc., which is Google’s parent company. It was originally a project within Google and later spun off into a separate company in 2016, under the Alphabet umbrella. Waymo focuses on autonomous driving technology and is one of the leading companies in the field of self-driving cars.

While Google, through its parent Alphabet, still has a stake in Waymo, the two are distinct entities. Google handles search, advertising, and other services, while Waymo is dedicated to developing and commercializing autonomous vehicle technology.