Alphabet incoming CFO Anat Ashkenazi, who spent 23 years at Eli Lilly;
Eli Lilly
For nine years, the role of CFO at Google and the parent company Alphabet There was Ruth Porat, who took a big pay package in 2015 to leave Wall Street for Silicon Valley.
On Tuesday, Porat’s successor, Anat Ashkenazi, made his earnings debut, saying one of his top priorities would be to drive more “cost efficiencies” at the company, an effort similar to that of his predecessor and Alphabet. It was started by CEO Sundar Pichai.
“Really well done, what Roth, Sunder and the rest of the leadership team started to do to re-engineer the cost base,” Ashkenazi, who previously spent 23 years at drugmaker Eli Lilly, said on the call. “But I think any organization can always go a little further and I will look for additional opportunities.”
Ashkenazi joined Alphabet in July, nearly a year after the company announced Porat would move into a new role as president and chief investment officer. His appearance on Tuesday came after Alphabet reported third-quarter earnings that beat the top and bottom lines thanks to strong revenue growth from the company’s search and cloud units.
Alphabet shares, up 21 percent for the year, rose another 5.8 percent in extended trading after the report.
The company is fighting to maintain its dominance in search advertising as artificial intelligence such as OpenAI and Perplexity grow in popularity. There’s also TikTok, which recently allowed brands to target ads based on search queries. Amazon And Metawhich are developing. The conversation AI tools.
To accommodate the changing competitive landscape and the changing economy, Google has made cuts and initiated internal changes. Ashkenazi said one of his priorities is to look across the organization for “greater efficiencies” so the company can invest in new areas and maintain its competitive edge and margins.
Alphabet reported capital expenditures of $13 billion in the third quarter, and Ashkenazi said it expects similar levels of spending in the fourth quarter. The majority went to technical infrastructure, including servers and data center equipment that power cloud and AI products, Ashkenazi said on the call.
The cloud is a top area that “requires investment,” he added, pointing to AI products needing to scale.
Ashkenazi warned that the company will spend more capital in 2025, echoing Pichai, who said, citing Search and Code, “there is an aggressive roadmap ahead for 2025.” Askenazi said the investment is based on customer demand so it will “translate into revenue in a fairly short period of time.”
Meanwhile, he and the leadership team will continue to cut the company’s expenses to “try and offset some of those investments.”
During the question-and-answer portion of the call, Mark Mahaney of Evercore ISI asked, “As you look at this update, is it clear to you that there are a lot of new cost efficiencies or ongoing cost efficiencies?”
Ashkenazi responded by saying that in the latest period, revenue has increased from “headcount management, facilities management, other process efficiencies” and that there are “more to come.”
The new CFO said one way Google will find additional efficiencies is to integrate AI “within our own processes and how we work.”
Look: Google Search is leveraging generative AI.