Google is delaying its return to office in response to a surge of coronavirus cases, the company announced on Wednesday.
Employees were told they can continue to work from home through October 18, CEO Sundar Pichai wrote in a memo, which was obtained by Insider. He also announced that employees who return to offices will need to be vaccinated against the virus.
Google recently reopened some of its offices for employees to return on a voluntary basis, but said employees would not be required back until September. However, a rise of coronavirus cases led by the more contagious Delta variant has now pushed back that deadline by more than a month.
The company has more than 140,000 full time employees, according to a recent regulatory filing.
“We are excited that we’ve started to re-open our campuses and encourage Googlers who feel safe coming to sites that have already opened to continue doing so,” Pichai wrote in the memo, which was later published on the company’s blog.
“At the same time, we recognize that many Googlers are seeing spikes in their communities caused by the Delta variant and are concerned about returning to the office. This extension will allow us time to ramp back into work while providing flexibility for those who need it.”
Google is the only tech giant so far to explicitly mandate COVID-19 vaccinations for its employees. CNBC tech reporter Josh Lipton said in a tweet that Apple CEO Tim Cook was still unsure whether imposing the same rule at Apple was “the right answer.”
Apple also pushed its return-to-office date back to October in response to the surge of cases, The New York Times reported earlier this month.
Pichai, the Google CEO, said the requirement for vaccinations would apply to US offices “in the coming weeks” and other regions “in the coming months.”
Alphabet blew past Wall Street’s second-quarter earnings expectations as the company continued benefit from the massive uptick in digital commerce during the pandemic.
Google’s parent company brought in $61.9 billion in total revenue during the quarter, up 62% year-over-year, versus $56.1 billion expected by analysts.
A year after its first-ever revenue decline, Google’s ad business skyrocketed in Q2 2021 with $57.1 billion in revenue, up 69% year-over-year, driven largely by Google search ads, which brought in $35.8 billion in revenue.
The company said advertising revenue at its YouTube division rose 84% year-over-year to $7 billion.
Google Cloud earned $4.6 billion in revenue and cut its operating loss to $591 million in Q2, its third-straight quarter of revenue growth since Google started separately reporting the financial performance of its cloud division in Q4 2020.
Here’s what Alphabet reported, compared to what analysts expected, according to Bloomberg.
Total revenue: $61.88 billion (Expected $56.03 billion, according to Yahoo Finance)
Revenue minus TAC: $50.95 billion (Expected $46.08 billion)
Google services revenue: $57.07 billion
Google Cloud revenue: $4.63 billion (Expected $4.34 billion)
Net income: $18.53 billion (Expected $13.05 billion)
Earnings per share (GAAP): $27.26 per share (Expected $19.35)
Tuesday marked Google’s first earnings report since announcing in March that it would make a major shift away from precisely tracking individual users based on their internet activity, viewed by some experts as a move to entrench its dominance of the digital ads market.
Sundar Pichai, chief executive of Google parent Alphabet, has offered some advice for people who want to run a successful company: Find something that excites you.
In an hour-long interview with the BBC’s media editor Amol Rajan, Pichai talks about the potential of quantum computing, the dangers of AI, and whether Alphabet, with a market capitalization of $1.6 trillion, is too big.
He also recalls the “simplicity” of his middle-class childhood growing up in Madurai, in the Indian state of Tamil Nadu, and his rise up the career ladder to become CEO of Alphabet in 2019, aged 47.
“I’ve always felt that – more than what your mind says – you need to figure out what your heart is excited by. It’s a journey and you will know it when you find it,” said Pichai.
“If you find that, things tend to work out,” he added.
Pichai said that he had wanted to work in Silicon Valley since he was a teenager and that his father took out a loan, worth a year’s salary, in order for Pichai to afford his flight and study at Stanford.
When asked how to land a job at Google, he gave some insight into the interview process when he applied for his first role in 2004. Pichai said: “You keep interviewing. I was interviewing on April Fool’s day and Google had just announced Gmail – which I thought was a joke.
“People kept asking me what I think of Gmail, which was invite-only at the time. It was only the fourth or fifth interviewer who asked ‘Have you seen Gmail?’ and I said no. He showed me on his computer.
“Then the next interview somebody asked me, I was able to answer it for the first time.”
He speaks to Mark Zuckerberg ‘as and when needed’
Pichai also offered some insight into his own personal work habits as CEO of one of the world’s biggest companies.
He wakes up between 6.30-7 am and tries to exercise three or four times a week. He doesn’t eat meat, and drinks tea in the mornings and coffee in the afternoons. He speaks three languages – English, Hindi and Tamil – and currently drives a Tesla.
The Wall Street Journal has been a long-term reading habit, although “90% of his consumption” is now online, from publications around the world.
When asked how often he speaks to Facebook chief and rival Mark Zuckerberg, he replied “as and when needed.”
Paul Pelosi, investment manager and the husband of House Speaker Nancy Pelosi, purchased up to $11 million worth of mega-cap tech stocks in May and June, according to a financial disclosure form filed last week.
Pelosi’s biggest purchase was $4.8 million worth of Alphabet shares on June 18, according to the disclosure. Pelosi exercised 40 call options to buy 4,000 shares at a strike price of $1,200. With shares of Alphabet currently trading at $2,524, that stock position is now worth more than $10 million, representing an unrealized gain of more than $5 million.
On May 21, Pelosi purchased up to $1 million worth of call options in Amazon, along with up to $250,000 in call options on Apple. According to the disclosure form, Pelosi purchased 20 Amazon call options with a strike price of $3,000 and an expiration date of June 17, 2022, along with 50 Apple call options with a strike price of $100 and an expiration date of June 17, 2022.
The stock purchases come as Pelosi’s wife and the House of Representatives work on anti-trust legislation designed to better regulate the massive multi-trillion dollar tech companies. Apple CEO Tim Cook recently called House Speaker Pelosi to voice his opposition to the pending legislation.
Finally, Pelosi purchased up to $5 million worth of Nvidia call options on June 3. According to the disclosure form, Pelosi purchased 50 Nvidia call options with a strike price of $400 and an expiration date of June 17, 2022.
The long-dated in-the-money call options give Pelosi leverage to the potential upside moves in mega-cap tech stocks. The trades could be a bet on a continued regime of low interest rates, muted inflation, and slowing economic growth in a post-pandemic recovery, or on the business outlook of the companies themselves.
This isn’t the first time the investment decisions of Pelosi’s husband came into focus. Earlier this year, Paul Pelosi purchased up to $1 million of long-dated Tesla call options.
After 27 years in charge, Jeff Bezos is stepping down as Amazon CEO.
Over the last 16 months, Amazon experienced a surge in demand as the coronavirus pandemic forced people to shop online more than ever. And as Amazon’s stock has hit new highs, Bezos’ net worth has jumped as well: These days, he’s worth $199 billion, according to Bloomberg.
It hasn’t been all smooth sailing, however. Bezos began his career in the hedge fund world in the 1990s, then left a cushy job to launch his own startup that didn’t turn a profit for years. In 2018, he weathered a high-profile divorce scandal, and Amazon has faced scrutiny over how it treats its workers and the impact it has on the environment.
Here’s how Bezos got his start and built a trillion-dollar empire.
Allana Akhtar contributed to an earlier version of this story.
Jeff Bezos’ mom, Jackie, was a teenager when she had him in January 1964. She had recently married Cuban immigrant Miguel Bezos, who adopted Jeff. Jeff didn’t learn that Miguel wasn’t his real father until he was 10, but says he was more fazed about learning he needed to get glasses than he was about the news.
When Bezos was 4, his mother told his biological father, who previously had worked as a circus performer, to stay out of their lives. When Brad Stone interviewed Bezos’ biological father for Stone’s book “The Everything Store,” Bezos’ dad had no idea who his son had become.
His grandfather, Preston Gise, was a huge inspiration for Bezos and helped kindle his passion for intellectual pursuits. At a commencement address in 2010, Bezos said Gise taught him “it’s harder to be kind than clever.”
Bezos fell in love with reruns of the original “Star Trek” and became a fan of later versions too. Early on, he considered naming Amazon MakeItSo.com, a reference to a line from Captain Jean-Luc Picard.
After spending a miserable summer working at McDonald’s as a teen, Bezos, together with his girlfriend, started the Dream Institute, a 10-day summer camp for kids. They charged $600 a kid and managed to sign up six students. The “Lord of the Rings” series made the required reading list.
Meanwhile, Bezos was taking ballroom dancing classes as part of a scheme to increase his “women flow.” Just as Wall Streeters have a process for increasing their “deal flow,” Bezos thought analytically about meeting women.
In 1994, Bezos read that the web had grown 2,300% in one year. This number astounded him, and he decided he needed to find some way to take advantage of its rapid growth. He made a list of 20 possible products to sell online and decided books were the best option.
Bezos decided to leave D.E. Shaw even though he had a great job. His boss at the firm, David E. Shaw, tried to persuade Bezos to stay. But Bezos was already determined to start his own company – he felt he’d rather try and fail at a startup than never try at all.
“When you are in the thick of things, you can get confused by small stuff,” he said later. “I knew when I was 80 that I would never, for example, think about why I walked away from my 1994 Wall Street bonus right in the middle of the year at the worst possible time. That kind of thing just isn’t something you worry about when you’re 80 years old.”
“At the same time, I knew that I might sincerely regret not having participated in this thing called the Internet that I thought was going to be a revolutionizing event,” he added. “When I thought about it that way … it was incredibly easy to make the decision.”
And so Amazon was born. MacKenzie and Jeff flew to Texas to borrow a car from his father, and then they drove to Seattle. Bezos was making revenue projections in the passenger seat the whole way, though the couple did stop to watch the sunrise at the Grand Canyon.
In the early days, a bell would ring in the office every time someone made a purchase, and everyone would gather around to see whether anyone knew the customer. It took only a few weeks before it was ringing so often they had to make it stop.
Bezos is known for banning PowerPoint presentations at Amazon. Instead, he requires his staff to turn in papers of a specific length on their proposals to encourage critical thinking over simplistic bullet points.
Bezos is also known for creating a frugal company culture that doesn’t offer perks like free food or massages.
In 1998, Bezos became an early investor in Google. He invested $250,000, which was worth about 3.3 million shares when the company went public in 2004. Those would be worth billions today (Bezos hasn’t said whether he kept any of his stock after the initial public offering).
In January 2017, Bezos purchased the Textile Museum, a pair of mansions in Washington, D.C.’s Kalorama neighborhood. The property sold for $23 million and is the largest in Washington. He’s currently spending $12 million to renovate the place.
Bezos also owns four apartments at 212 Fifth Avenue in New York City. His most recent purchase in the building was last April, when he paid a reported $16 million for a three-bedroom unit, bringing his total real estate holdings in the building to nearly $100 million.
In February 2020, Bezos became the new owner of the Warner estate, a sprawling compound in Beverly Hills, California, that he reportedly purchased for $165 million. A few months later, Bezos added to the compound with an adjacent house worth $10 million.
In August 2017, Amazon officially acquired Whole Foods for $13.7 billion. The Amazon influence became immediately clear: Customers who are Amazon Prime subscribers can get 10% of sale prices, and you’ll see some Amazon branded items offered, including tech products like the popular Amazon Echo line.
In January 2019, Bezos and his wife of 25 years, novelist MacKenzie Bezos, announced they were divorcing. “As our family and close friends know, after a long period of loving exploration and trial separation, we have decided to divorce and continue our shared lives as friends,” the couple wrote in the statement. “If we had known we would separate after 25 years, we would do it all again.”
Shortly after the Bezoses announced their divorce last January, news broke that Bezos was dating TV host and helicopter pilot Lauren Sanchez.
At the time, the National Enquirer said it had conducted a four-month investigation into Bezos and Sanchez’s relationship and had obtained texts and explicit photos the couple had sent to each other.
Almost immediately, questions arose about the Enquirer’s motives for investigating Bezos and Sanchez and the tabloid’s connection to President Trump — Bezos immediately launched an investigation into who had leaked his personal messages.
Then, in February, Bezos dropped a bombshell of his own: an explosive blog post titled “No thank you, Mr. Pecker,” in which he accused Pecker and AMI of trying to blackmail him. As a result, Bezos published the emails he’d received from AMI.
“Rather than capitulate to extortion and blackmail, I’ve decided to publish exactly what they sent me, despite the personal cost and embarrassment they threaten,” Bezos wrote.
The Bezoses announced on Twitter they had finalized the term of their divorce in April 2019. MacKenzie retained more than $35 billion in Amazon stock, making her one of the world’s richest women.
During the coronavirus outbreak, Amazon saw a surge in demand as more people were forced to shop online. Amazon created more jobs and raised pay for workers, but Bezos and the company faced scrutiny over worker safety during the outbreak.
The company is also facing antitrust concerns, particularly the company’s practices when it comes to third-party sellers on its platform. Bezos and other major tech CEOs will testified in front of Congress at the end of July 2020.
After the killing of George Floyd and the protests that followed, Bezos was outspoken about his support for the Black Lives Matter movement, publicly shaming customers who sent racist emails about his and Amazon’s support. In an Instagram post, he posted a screenshot of a customer email and described the man as “the kind of customer I’m happy to lose.”
In recent months, Bezos and Tesla and SpaceX CEO Elon Musk have seen their respective net worths spike. The two moguls have flip-flopped for the spot of world’s richest person, though it appears Bezos is staying on top with a fortune worth nearly $200 billion.
“Being the CEO of Amazon is a deep responsibility, and it’s consuming,” Bezos wrote. “When you have a responsibility like that, it’s hard to put attention on anything else.”
Bezos said that while he will still be involved in important initiatives at Amazon, he plans to spend more time on philanthropy — including the Bezos Earth Fund and his Day 1 Fund — as well as his two other major endeavors: the Washington Post, which he purchased 2013, and his rocket company, Blue Origin.
Bezos’ next adventure won’t take place on planet Earth. On July 20, he’ll take an 11-minute voyage to the edge of space aboard a Blue Origin spacecraft. He’ll be accompanied by his brother, Mark; a mysterious bidder who bought the seat for $28 million; and Wally Funk, an 82-year-old aviator who trained to go to space in the ’60s but was ultimately denied the opportunity because she was a woman.
Britain’s competition regulator has opened a formal investigation into Amazon and Google over concerns the tech giants have not done enough to combat fake reviews on their sites.
The Competition and Markets Authority (CMA) said Friday that it would now gather further information to determine whether the firms may have broken consumer law by taking insufficient action to protect shoppers from fake reviews.
The move comes after an initial CMA investigation, which opened in May 2020, and assessed several platforms’ internal systems and processes for identifying and dealing with fake reviews.
The regulator said it was also concerned that Amazon’s systems had failed adequately to prevent and deter some sellers from manipulating product listings, through for example co-opting positive reviews from other products.
“Our worry is that millions of online shoppers could be misled by reading fake reviews and then spending their money based on those recommendations,” Andrea Coscelli, CEO of the CMA, said.
“Equally, it’s simply not fair if some businesses can fake 5-star reviews to give their products or services the most prominence, while law-abiding businesses lose out.”
Amazon said in February that it prohibited the abuse of its review features by both sellers and reviewers. It suspends, bans, and takes legal action against accounts that violate these policies, it said, and it analyzes more than 10 million reviews each week.
It reportedly removed 20,000 product reviews in September after a Financial Times investigation suggested that some of the site’s top UK reviewers may have profited from leaving positive ratings.
Google uses a research-and-development strategy known within the company as ‘pantry mode,’ according to a report Monday in The New York Times. When teams create new products, they often sit on them until a competitor announces something new or similar that Google decides it should respond to, according to the report.
Despite Google’s soaring profit and revenue, some former and current Google executives told the Times they worry that ‘pantry mode’ is just one indicator of an increasingly risk-averse culture that’s tied to CEO Sundar Pichai’s struggle to make important decisions in a timely manner.
Pichai’s leadership style allows the Google management team to make many decisions without his sign-off, according to the Times. Some Google employees view this as a lack of ego, while others see it as an inability to take action due to an obsession with what the public might think, according to the report.
A spokesperson for Google did not immediately respond to a request for comment, but the company provided other executives to the Times to speak to Pichai’s leadership style, which you can read here, and said employees had good things to say about him in internal surveys.
Google is spending more than ever on R&D under Pichai
While it’s not clear exactly which products or services have been developed as part of a “pantry mode” strategy, Google has steadily spent more money on researching and developing new products during Pichai’s tenure as CEO.
Pichai took over as chief executive in 2015, and the company’s R&D costs have grown every year since. Google’s parent company, Alphabet, which Pichai became CEO of at the end of 2019, spent $27.57 billion on R&D in 2020.
Building off rival products is not a strategy isolated to Google. Last summer, newly released emails from April 2012 show Facebook CEO Mark Zuckerberg and other executives agreeing that “copying is faster than innovating.”
As Google continues growing in size and value, the Times’ report makes it clear it’s facing a common concern that comes with being an entrenched and dominant company: is it moving too slowly and playing things too safe?
David Baker, a former director of engineering at Google’s trust and safety group, told the Times, “The more secure Google has become financially, the more risk-averse it has become.”
Investors should hold off on diving back into shares of large technology companies as the industry faces regulatory challenges and will be hurt again by rising borrowing costs, according to the wealth management team at UBS.
Major technology shares overall have recovered from their lows of the year. High-flying tech stocks were ditched by investors earlier in the year as buyers sought companies they believed have more direct exposure to the reopening of the economy. The Nasdaq Composite is up about 10% so far this year and the NYSE FAANG+ index that tracks mega-cap tech stocks has picked up about 9%.
But a move back into tech stock may be a misstep for investors in the short-run, UBS said.
“We don’t think investors should rush back into big tech, with the tactical outlook favoring reflation and reopening beneficiaries like financials and energy,” said Mark Haefele, chief investment officer of global wealth management at UBS, in a note published Monday.
One reason for the view is that UBS expects yields on government bonds to begin rising again. That could spell another round of trouble for tech stocks after the closely watched 10-year yield earlier this year quickly zoomed up to a 14-month high of 1.76%. The jump to the peak in March stemmed from investors selling bonds and pursuing riskier assets as coronavirus vaccinations and government spending plans fostered strong growth prospects for the world’s largest economy. But the higher yields stoked worries that higher borrowing costs would hurt technology companies.
Yields have pulled back from their highs as investors appeared to have embraced the Federal Reserve’s view that hot inflation levels will be temporary and that it will stick with measures to support economic growth. UBS, however, said it believes yields will begin gradually rising again to the detriment of tech shares.
Also, “we think that US antitrust developments could pose near-term headline risk for tech stocks,” said Haefele.
Last week, House lawmakers introduced five bills aimed at giving regulators more power to control tech companies from holding too much market dominance and the bills have some bipartisan support. The legislation is aimed at Amazon, Apple, Facebook and Alphabet, Google’s parent company, which in recent years have faced heavy scrutiny related to antitrust concerns.
“So within a portfolio context, we think investors should consider allocating to growth and technology via private equity holdings,” as the investment case for the tech industry is still sound on a longer-term basis, said UBS.
It said global tech acquisitions within private equity rose to $82 billion in the first quarter, marking an all-time high for a quarter, and were up by 144% compared with the first quarter in 2020.
“With approximately 497,000 global private tech companies, the breadth of investable companies is vast compared to the roughly 8,100 publicly held tech firms,” UBS said.
House Democrats plan to introduce five separate bills as early as this week that could dramatically reign in big tech companies’ economic dominance, Politico reported Wednesday.
The bills address a number of lawmakers’ concerns about the growing power of tech titans like Amazon, Apple, Alphabet-owned Google, and Facebook.
One bill, headed up by Rep. Pramilia Jayapal, of Washington, would let the Department of Justice or Federal Trade Commission sue to break up tech companies by forcing them to sell parts of their business that present a conflict of interest, Politico reported. That could spell trouble for companies like Amazon and Google, which critics say use their dominance of web hosting and digital ad markets to promote their own products and services.
A second bill, authored by Rep. David Cicilline, a Democrat from Rhode Island, would ban large tech companies from favoring their own products in digital marketplaces they operate and set the rules for, according to Politico. That takes aim at how Apple’s App Store policies impact app developers and how Amazon treats third-party sellers in its marketplace.
A fourth bill, sponsored by Rep. Mary Gay Scanlon, of Pennsylvania, would require platforms with more than 500,000 US users, or those designated by regulators as a “critical trading partner,” to make it easier for users to move their data to rival platforms, Politico reported. Lawmakers have criticized Facebook and Google for hoarding users’ personal data in an endless “feedback loop” that helps them maintain their market power.
The final bill, identical to one sponsored by Sens. Amy Klobuchar (D-MN) and Chuck Grassley (R-IA) in a spending bill that passed this week, Politico reported, would require companies to pay antitrust regulators more when seeking their approval for mergers. Regulators are vastly underresourced compared to the tech giants they’re tasked with regulating, placing them at a huge disadvantage if they seek to block a merger and it goes to court – increased legal fees could help balance the scales.
The set of bills reflects recommendations from a landmark 449-page House Judiciary Committee report last fall that called the companies monopolies that needed to be broken up.
The report was the result of an extensive investigation in which the committee probed whether major tech companies had used their size and market position to engage in anticompetitive behaviors that unfairly harmed rivals, consumers, and society more broadly.
Around a quarter of Americans say they work mostly in the gig economy, and 62% of those workers say that they’d rather not, according to a survey published Wednesday by McKinsey and Ipsos.
“Gig workers would overwhelmingly prefer permanent employment,” the survey found.
That preference is even stronger among immigrants and workers of color, who disproportionately make up the gig workforce.
Among those groups, 72% of Hispanic and Latino gig workers, 71% of Asian American gig workers, and 68% of Black gig workers said they’d rather be permanent or non-contract employees, as did 76% and 73% of first- and second-generation immigrants, respectively.
McKinsey and Ipsos surveyed 25,000 Americans over the spring of 2021, and 27% percent of those surveyed said their primary job at the time was as a contract, freelance, or temporary work.
But their resounding preference for the security, benefits, and legal protections that come with employee status could encounter some tough resistance: their bosses.
Globally, 70% of executives – mostly from large US firms – said they plan to ramp up their reliance on contract and temporary workers, according to a McKinsey study from September.
Corporate America has aggressively opposed efforts to reclassify contractors as employees, in many cases arguing that workers prefer the flexibility that gig work claim to offer. But McKinsey’s latest findings suggest that executives – often citing surveys that their own companies funded – may not be as in touch with workers’ needs and wants.
While companies like Uber, Lyft, DoorDash, Grubhub, Amazon, Facebook, and Google have played leading roles in familiarizing American consumers with the gig-based business model, they’re far from the only ones who have leveraged contractors to skirt labor laws and minimize their costs. (Insider has contacted the above companies for comment, and will update this story if they respond.)
Executives in the lodging, food service, healthcare, and social assistance sectors, are especially keen on relying more heavily on contractors, according to McKinsey.
That model also hit taxpayers hard, as they subsidized unemployment benefits for contractors laid off by multibillion-dollar corporations that, despite record profits, hadn’t contributed a dime to those funds on behalf of their workers. Taxpayers coughed up $80 million in pandemic assistance for around 27,000 Uber and Lyft drivers who lost their incomes.
State and federal lawmakers are increasingly considering ways to secure better pay, working conditions, and legal protections for contractors, from California’s AB-5 to recent talks between unions and app companies in New York, though experts say more wide-reaching labor law reforms are needed.