Google CFO Signals More Spending Cuts to Meet Savings Targets
Google’s finance chief told employees to expect more spending cuts in areas from how it uses its servers to when it closes employee cafes as the company tries to meet savings targets this year.
Ruth Porat,
who serves as chief financial officer of both Google and parent company
Alphabet Inc.,
GOOG 2.65%
said Friday in a staff memo that Google would eliminate some snack bars, or “microkitchens,” and close cafeterias on days with modest traffic. Google will also introduce an internal tool that helps teams pick low-cost providers of outside services such as software and equipment providers.
“Just as we did in 2008, we’ll be looking at data to identify other areas of spending that aren’t as effective as they should be, or that don’t scale at our size,” Ms. Porat wrote in the email, viewed by The Wall Street Journal.
One of Google’s objectives this year is to “deliver durable savings through improved velocity and efficiency,” Ms. Porat wrote.
“This work is particularly vital because of our recent growth, the challenging economic environment, and our incredible investment opportunities to drive technology forward—particularly in AI,” she wrote.
Tech companies have recently embarked on additional rounds of belt-tightening in response to economic uncertainty, adding to previous expense cuts following a reversal in pandemic-era growth. Earlier this month,
Meta Platforms Inc.
said it would cut about 10,000 jobs in the coming months, part of a so-called “year of efficiency,” after laying off about 11,000 employees last fall.
Ruth Porat, chief financial officer of Alphabet, said that Google is aiming to deliver durable savings.
Photo:
Hollie Adams/Bloomberg News
Amazon.com Inc.
also said this month it would cut 9,000 more corporate jobs in areas like advertising and cloud computing after previously announcing plans to slash 18,000 positions.
Alphabet said in January it would cut about 12,000 jobs, or 6% of staff, in the largest layoffs in the company’s history. Chief Executive
Sundar Pichai
said executives would also receive lower bonuses following the cuts.
Ms. Porat said in the email that Alphabet’s layoffs are “still being worked through in some countries.” The company will continue to hire at a slower pace, she said.
Google is also trying to lower the costs associated with running its product offerings, including artificial-intelligence models, Ms. Porat wrote.
“We are focused on distributing our compute workloads even more efficiently, getting more out of our servers and data centers,” she wrote. “We’ve already made progress with these efforts and will continue to drive efficiencies—this work adds up given infrastructure is one of our largest areas of investment.”
A Google spokesman declined to comment on the memo.
Write to Miles Kruppa at [email protected]
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
Google’s finance chief told employees to expect more spending cuts in areas from how it uses its servers to when it closes employee cafes as the company tries to meet savings targets this year.
Ruth Porat,
who serves as chief financial officer of both Google and parent company
Alphabet Inc.,
GOOG 2.65%
said Friday in a staff memo that Google would eliminate some snack bars, or “microkitchens,” and close cafeterias on days with modest traffic. Google will also introduce an internal tool that helps teams pick low-cost providers of outside services such as software and equipment providers.
“Just as we did in 2008, we’ll be looking at data to identify other areas of spending that aren’t as effective as they should be, or that don’t scale at our size,” Ms. Porat wrote in the email, viewed by The Wall Street Journal.
One of Google’s objectives this year is to “deliver durable savings through improved velocity and efficiency,” Ms. Porat wrote.
“This work is particularly vital because of our recent growth, the challenging economic environment, and our incredible investment opportunities to drive technology forward—particularly in AI,” she wrote.
Tech companies have recently embarked on additional rounds of belt-tightening in response to economic uncertainty, adding to previous expense cuts following a reversal in pandemic-era growth. Earlier this month,
Meta Platforms Inc.
said it would cut about 10,000 jobs in the coming months, part of a so-called “year of efficiency,” after laying off about 11,000 employees last fall.
Ruth Porat, chief financial officer of Alphabet, said that Google is aiming to deliver durable savings.
Photo:
Hollie Adams/Bloomberg News
Amazon.com Inc.
also said this month it would cut 9,000 more corporate jobs in areas like advertising and cloud computing after previously announcing plans to slash 18,000 positions.
Alphabet said in January it would cut about 12,000 jobs, or 6% of staff, in the largest layoffs in the company’s history. Chief Executive
Sundar Pichai
said executives would also receive lower bonuses following the cuts.
Ms. Porat said in the email that Alphabet’s layoffs are “still being worked through in some countries.” The company will continue to hire at a slower pace, she said.
Google is also trying to lower the costs associated with running its product offerings, including artificial-intelligence models, Ms. Porat wrote.
“We are focused on distributing our compute workloads even more efficiently, getting more out of our servers and data centers,” she wrote. “We’ve already made progress with these efforts and will continue to drive efficiencies—this work adds up given infrastructure is one of our largest areas of investment.”
A Google spokesman declined to comment on the memo.
Write to Miles Kruppa at [email protected]
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
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