Google’s revenue continues to grow as its profits are still shrinking

Earlier this summer, Google’s parent company Alphabet made it clear that it was trying to get into fighting form as its profits slipped. The company’s earnings report, released on Tuesday, however, shows that it still appears to be on the same path of growing revenue but shrinking profits.

This quarter, the company reports that it earned around $69 billion and made $13.9 billion in profit. That’s compared to its exceptional Q3 2021, when it brought in $65.1 billion in revenue, netting $18.9 billion and making for a fifth straight quarter of record-breaking profits. As another point of comparison, the company earned almost $69.7 billion last quarter, with profits of around $16 billion.

Most of Google’s businesses have grown year over year: advertising brought in $54.4 billion, up from $53.1 billion, and Google Cloud jumped from $4.9 billion in Q3 2021 to almost $6.9 billion in 2022 — though it’s worth noting that the company’s losses on its cloud division are also up, going from $644 million to $699 million. It’s also losing even more money on its “other bets” category: approximately $1.6 billion this year, compared to almost $1.3 billion last year. Revenue from YouTube ads, however, has shrunk slightly, as has its income from Google Network.

That “sharpened focus” brings us to the matter of the company’s people. Near the end of Q2, CEO Sundar Pichai sent out a memo telling employees that the company could face difficulties under tough economic conditions and that it would have to focus. A quote from Pichai in the press release echoes that, saying, “We’re sharpening our focus on a clear set of product and business priorities.”

To that end, Google has been working on reviewing its headcount. Despite that, the company reports it grew compared to last quarter: in July, it had 174,014 employees, and that count is now at 186,779.

The company’s been not so quietly reducing its numbers by getting rid of or reorganizing specific teams and giving former members a window to find new roles within the company, knowing that not all of them will. But that process means they may not officially leave its roster for weeks or months.