Google Cloud lost $3.1bn in 2021

However, parent company Alphabet reported record revenues thanks to a "quarterly sales record" for the Pixel 6

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Image: Shutterstock via Dennis Publishing

2 February 2022

Google’s cloud division reported another year of losses, despite extending the life of its hardware by a further 12 months.

The cloud giant lost $890 million in the fourth quarter of 2021 and $3.1 billion over the entire year, according to financial results posted by its parent company, Alphabet.

Last year Google extended the operational lifespan of its cloud servers from three to four years in a bid to offset some costs. While the switch saved the company $3.6 billion in reduced depreciation expenses and brought in a $2 billion net income increase, it still wasn’t enough to make the tech giant’s cloud arm profitable.

Cloud losses were relatively minor compared to Alphabet’s overall financial outlook; the company reported record-breaking revenues of $257 billion for 2021, a 41% year-on-year increase. The company also reported Q4 revenue of $75.3 billion, which is a 32% increase compared to 2020.

“Q4 saw ongoing strong growth in our advertising business, which helped millions of businesses thrive and find new customers, a quarterly sales record for our Pixel phones despite supply constraints, and our cloud business continuing to grow strongly,” Alphabet and Google CEO Sundar Pichai said.

Alphabet doesn’t usually reveal specific financial or sales information when it comes to its hardware, or even for its Android mobile operating system, and typically bundles them into a category listed as ‘Google other’. This category brought in $8.16 billion of revenue for the fourth quarter, and it is worth pointing out that its latest Pixel handsets – Pixel 6 and Pixel 6 Pro – both went on sale just before.

2021 was the first time Alphabet surpassed $200 billion in revenue, pulling in $258 billion, which is almost triple what it reported in 2016 ($90 billion).

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