Google spent $2.1 billion on severance payments when laying off over 12,000 employees throughout 2023. And the layoff charges keep coming: in just one month of 2024 so far, the company has already spent another $700 million on 1,000 more layoffs.
Alphabet, Google’s parent company, revealed the figure along with the release of its fourth-quarter results on Tuesday.
Despite the cuts, Google closed 2023 with growth in most of its main lines of business. Google recorded revenues of $86 billion in the fourth quarter of 2023, representing a year-on-year increase of 13%.
Increased profits and layoffs, the world upside down
The main digital advertising and cloud computing businesses of the search giant also showed steady growth, which CEO Sundar Pichai attributed to Google’s investments in generative AI.
Google’s main revenue generator, its search engine business, generated $48 billion, an increase of nearly 13% year-over-year. The company’s subscription services and devices segment generated $10.7 billion, primarily thanks to subscriptions to YouTube Premium and Music, YouTube TV, and Google One, according to Pichai. YouTube’s advertising revenue amounted to $9.2 billion, a 15% increase from last year.
Google is currently the third largest cloud provider in the world, behind Microsoft’s Azure and AWS. But the cloud division gained momentum last year. The company recorded revenues of $9.19 billion in Google Cloud, representing a significant year-on-year increase of 25.6%.
And Google’s continuous investments in AI, or its “Gemini era”, mean that in 2024 there will be even more layoffs, as the company will make cuts in other divisions to compensate.
