Dive Brief:
- Alphabet, the parent company of Google since 2015, announced strong second quarter results last week boasting 21% revenue growth year-over-year resulting in $21.5 billion in revenue.
- At the same time, however, the company's "Other Bets" unit, which focuses on longshot developments in areas including healthcare, saw its losses grow by 30% to $859 million.
- Alphabet's greatest investment in healthcare is in Verily, formerly Google Life Sciences, which is among just three of Alphabet's bets that are making money, along with home hardware company Nest and high speed internet unit Fiber, Fortune added.
Dive Insight:
Alphabet's share price rose nearly 6% in after hours trading following its Q2 report to a record $810 per share.
Investors didn't appear to mind the "Other Bets" losses, instead seeming to embrace that Google is in such a strong position that it can afford to spend $859 million for a return of $185 million in revenue, Fortune noted. It helps that number is a 150% increase, far more significant than the increased losses, which demonstrates progress.
Verily is known for its work on smart contact lens technology as well as other sensor based technologies that target chronic conditions, most notably diabetes, according to PharmExec.
Alphabet CIO Ruth Porat attributed the company's primary growth to successful investments in areas including mobile and video, and stressed responsibility in the company's spending on other ventures. "We continue to invest responsibly in support of our many compelling opportunities,” she stated.