UNITED STATESSECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549________________________________________________________________________________________FORM 10-Q(Mark One)☒________________________________________________________________________________________QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2023
OR☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______ to _______
Commission file number: 001-37580________________________________________________________________________________________

Alphabet Inc.
(Exact name of registrant as specified in its charter)________________________________________________________________________________________

Delaware(State or other jurisdiction of incorporation or organization)

61-1767919(I.R.S. Employer Identification Number)

1600 Amphitheatre Parkway
Mountain View, CA 94043(Address of principal executive offices, including zip code)(650) 253-0000(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each classClass A Common Stock, $0.001 par value

Trading Symbol(s)GOOGLClass C Capital Stock, $0.001 par value

GOOG

Name of each exchange on which registered
Nasdaq Stock Market LLC(Nasdaq Global Select Market)
Nasdaq Stock Market LLC(Nasdaq Global Select Market)________________________________________________________________________________________

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file suchreports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted
pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter periodthat the registrant was required to submit such files). Yes ☒ No ☐Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smallerreporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smallerreporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer
Non-accelerated filer
Emerging growth company

☒
☐
☐

☐
☐

Accelerated filer
Smaller reporting company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period forcomplying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

☒

Yes ☐

No

As of July 18, 2023, there were 5,933 million shares of Alphabet’s Class A stock outstanding, 875 million shares of Alphabet's
Class B stock outstanding, and 5,801 million shares of Alphabet's Class C stock outstanding.

Table of Contents

Alphabet Inc.
Alphabet Inc.
Form 10-Q
For the Quarterly Period Ended June 30, 2023
TABLE OF CONTENTS
Page No.

Note About Forward-Looking Statements

3PART I. FINANCIAL INFORMATION
Item 1 Financial Statements
Consolidated Balance Sheets - December 31, 2022 and June 30, 2023
Consolidated Statements of Income - Three and Six Months Ended June 30, 2022 and 2023
Consolidated Statements of Comprehensive Income - Three and Six Months Ended June 30,
2022 and 2023
Consolidated Statements of Stockholders' Equity - Three and Six Months Ended June 30,
2022 and 2023
Consolidated Statements of Cash Flows - Six Months Ended June 30, 2022 and 2023
Notes to Consolidated Financial Statements

10
11

Item 2

Management’s Discussion and Analysis of Financial Condition and Results of Operations

33

Item 3

Quantitative and Qualitative Disclosures About Market Risk

48

Item 4Controls and Procedures

48

5
5
6
7
8

PART II. OTHER INFORMATION
Item 1

Legal Proceedings

50

Item 1A Risk Factors

50

Item 2

Unregistered Sales of Equity Securities and Use of Proceeds

50

Item 5

Other Information

49

Item 6

Exhibits

52

Signatures

53

2

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Alphabet Inc.
Note About Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These include, among other things, statements regarding:•the growth of our business and revenues and our expectations about the factors that influence our successand trends in our business;•fluctuations in our revenues and margins and various factors contributing to such fluctuations;•

our expectation that the continuing shift from an offline to online world will continue to benefit our business;•

our expectation that the portion of our revenues that we derive from non-advertising revenues will continue
to increase and may affect our margins;•

our expectation that our traffic acquisition costs (TAC) and the associated TAC rate will fluctuate, which
could affect our overall margins;•

our expectation that our monetization trends will fluctuate, which could affect our revenues and margins;•fluctuations in our revenues, as well as the change in paid clicks and cost-per-click and the change in
impressions and cost-per-impression, and various factors contributing to such fluctuations;•

our expectation that we will continue to periodically review, refine, and update our methodologies formonitoring, gathering, and counting the number of paid clicks and impressions;•

our expectation that our results will be affected by our performance in international markets as users indeveloping economies increasingly come online;•

our expectation that our foreign exchange risk management program will not fully offset our net exposure tofluctuations in foreign currency exchange rates;•

the expected variability of gains and losses related to hedging activities under our foreign exchange risk
management program;•the amount and timing of revenue recognition from customer contracts with commitments for performanceobligations, including our estimate of the remaining amount of commitments and when we expect torecognize revenue;•

fluctuations in our capital expenditures;•

our expectation that we will continue to invest in our technical infrastructure;•

our plans to continue to invest in new businesses, products, services and technologies, systems, land andbuildings for data centers, and infrastructure, as well as to continue to invest in acquisitions and strategic
investments;•

our pace of hiring and our plans to provide competitive compensation programs;•

our expectation that our cost of revenues, research and development (R&D) expenses, sales and marketing
expenses, and general and administrative expenses may increase in amount and/or may increase as apercentage of revenues and may be affected by a number of factors;•

estimates of our future compensation expenses;•

our expectation that our other income (expense), net (OI&E), will fluctuate in the future, as it is largely
driven by market dynamics;•

fluctuations in our effective tax rate;•seasonal fluctuations in internet usage and advertiser expenditures, underlying business trends such as
traditional retail seasonality, which are likely to cause fluctuations in our quarterly results;•

the sufficiency of our sources of funding;•our potential exposure in connection with new and pending investigations, proceedings, and othercontingencies, including the possibility that certain legal proceedings to which we are a party could harm
our business, financial condition, and operating results;

3

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Alphabet Inc.

•

our expectation that we will continue to face heightened regulatory scrutiny, and the sufficiency and timingof our proposed remedies in response to decisions from the European Commission (EC) and otherregulators and governmental entities;•

the expected timing, amount, and effect of Alphabet Inc.'s share repurchases;•

our long-term sustainability and diversity goals;•

the unpredictability of the ongoing broader economic effects resulting from the war in Ukraine on our futurefinancial results;•

the expected financial effect of our announced workforce reduction and office space optimization;•

our expectation that the change in estimated useful lives of servers and certain network equipment will havea favorable effect on our 2023 operating results;

as well as other statements regarding our future operations, financial condition and prospects, and businessstrategies. Forward-looking statements may appear throughout this report and other documents we file with the
Securities and Exchange Commission (SEC), including without limitation, the following sections: Part I, Item 2,"Management's Discussion and Analysis of Financial Condition and Results of Operations" in this Quarterly Reporton Form 10-Q and Part I, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended
December 31, 2022. Forward-looking statements generally can be identified by words such as "anticipates,""believes," "estimates," "expects," "intends," "plans," "predicts," "projects," "will be," "will continue," "may," "could,""will likely result," and similar expressions. These forward-looking statements are based on current expectations andassumptions that are subject to risks and uncertainties, which could cause our actual results to differ materially fromthose reflected in the forward-looking statements. Factors that could cause or contribute to such differences include,
but are not limited to, those discussed in this Quarterly Report on Form 10-Q, and in particular, the risks discussed
in Part I, Item 1A, "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022,
and those discussed in other documents we file with the SEC. We undertake no obligation to revise or publicly
release the results of any revision to these forward-looking statements, except as required by law. Given these risks
and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements.
As used herein, "Alphabet," "the company," "we," "us," "our," and similar terms include Alphabet Inc. and its
subsidiaries, unless the context indicates otherwise.
"Alphabet," "Google," and other trademarks of ours appearing in this report are our property. We do not intend
our use or display of other companies' trade names or trademarks to imply an endorsement or sponsorship of us bysuch companies, or any relationship with any of these companies.

4

Table of Contents
PART I.
ITEM 1.

Alphabet Inc.

FINANCIAL INFORMATIONFINANCIAL STATEMENTS
Alphabet Inc.
CONSOLIDATED BALANCE SHEETS(in millions, except par value per share amounts)
As ofDecember 31, 2022

As ofJune 30, 2023
(unaudited)

AssetsCurrent assets:
Cash and cash equivalents$
Marketable securities
Total cash, cash equivalents, and marketable securities
Accounts receivable, net
Inventory
Other current assets
Total current assets
Non-marketable securities
Deferred income taxes
Property and equipment, net
Operating lease assets
Intangible assets, net
Goodwill
Other non-current assets
Total assets$
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable$
Accrued compensation and benefits
Accrued expenses and other current liabilities
Accrued revenue share
Deferred revenue
Total current liabilities
Long-term debt
Deferred revenue, non-current
Income taxes payable, non-current
Deferred income taxes
Operating lease liabilities
Other long-term liabilities
Total liabilities
Commitments and contingencies (Note 9)
Stockholders’ equity:
Preferred stock, $0.001 par value per share, 100 shares authorized; noshares issued and outstanding
Class A, Class B, and Class C stock and additional paid-in capital,$0.001 par value per share: 300,000 shares authorized (Class A 180,000,
Class B 60,000, Class C 60,000); 12,849 (Class A 5,964, Class B 883,
Class C 6,002) and 12,629 (Class A 5,934, Class B 876, Class C 5,819)
shares issued and outstanding
Accumulated other comprehensive income (loss)
Retained earnings
Total stockholders’ equity
Total liabilities and stockholders’ equity$
See accompanying notes.

5

21,87991,883
113,762
40,2582,670
8,105
164,795
30,492
5,261
112,668
14,381
2,084
28,9606,623
365,264$

5,128
14,02837,866
8,370
3,908
69,30014,701
599
9,258
514
12,501
2,247
109,120$$

25,92992,403
118,332
38,804
2,231
9,421
168,788
31,224
9,357
121,208
14,4691,966
29,2106,822
383,044

5,313
11,26049,3007,990
3,846
77,70913,705
667
8,753
558
12,746
1,765
115,9030068,18472,248(7,603)
195,563
256,144
365,264 $(5,991)200,884
267,141
383,044

Table of Contents

Alphabet Inc.
Alphabet Inc.
CONSOLIDATED STATEMENTS OF INCOME(in millions, except per share amounts; unaudited)Three Months Ended
June 30,

Revenues
Costs and expenses:
Cost of revenues
Research and development
Sales and marketing
General and administrative
Total costs and expenses
Income from operations
Other income (expense), net
Income before income taxes
Provision for income taxes$

Net income$

Basic net income per share of Class A, Class B, and Class
C stock$
Diluted net income per share of Class A, Class B, and Class
C stock
$

2022

2023

2022

69,685 $74,604 $137,696

30,104
9,841
6,630
3,657
50,232
19,453(439)
19,014
3,012

31,916
10,5886,781
3,481
52,766
21,83865
21,903
3,535

59,703
18,96012,455
7,031
98,14939,547(1,599)37,9485,510

16,002 $18,368 $32,438$33,4191.22 $

1.45 $

2.46

$

2.63

1.21 $

1.44 $

2.44

$

2.61

See accompanying notes.

6

Six Months Ended
June 30,2023$

144,391
62,52822,056
13,314
7,240
105,138
39,253855
40,1086,689

Table of Contents

Alphabet Inc.
Alphabet Inc.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME(in millions; unaudited)Three Months Ended

Six Months Ended

June 30,

Net income$
Other comprehensive income (loss):
Change in foreign currency translation adjustment
Available-for-sale investments:
Change in net unrealized gains (losses)
Less: reclassification adjustment for net (gains)losses included in net income
Net change, net of income tax benefit (expense)of $227, $106, $860 and $(224)Cash flow hedges:
Change in net unrealized gains (losses)
Less: reclassification adjustment for net (gains)losses included in net income
Net change, net of income tax benefit (expense)of $(113), $(11), $(69) and $19
Other comprehensive income (loss)
Comprehensive income
$

2023

2022

2023

16,002 $18,368 $32,438 $33,419(1,665)235(1,626)

831

(926)

(570)

(3,404)

296

233

198

381

490

(693)

(372)

(3,023)

786

915

151

1,029

77

(336)

(5)

(585)

(82)

579
(1,779)14,223 $146
918,377 $444(4,205)28,233 $See accompanying notes.

7

June 30,

2022

(5)
1,612
35,031

Table of Contents

Alphabet Inc.
Alphabet Inc.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY(in millions; unaudited)Three Months Ended June 30, 2022
Class A, Class B, Class C Stockand Additional Paid-In Capital
SharesBalance as of March 31, 2022
Stock issued
Stock-based compensation expense
Tax withholding related to vesting ofrestricted stock units and other
Repurchases of stock
Net income
Other comprehensive income (loss)
Balance as of June 30, 2022

AmountAccumulated
Other
Comprehensive
Income (Loss)

Retained
Earnings

Total
Stockholders’Equity13,175 $36
062,832 $1
4,823(4,049) $00195,221 $00

254,004
1
4,823

0
(133)
0
0
13,078 $(2,434)(820)
0064,402 $000(1,779)(5,828) $(1)(14,377)
16,0020
196,845 $(2,435)(15,197)
16,002(1,779)255,419

Six Months Ended June 30, 2022
Class A, Class B, Class C Stockand Additional Paid-In Capital
SharesBalance as of December 31, 2021
Stock issued
Stock-based compensation expense
Tax withholding related to vesting ofrestricted stock units and other
Repurchases of stock
Net income
Other comprehensive income (loss)
Balance as of June 30, 2022

AmountAccumulated
Other
Comprehensive
Income (Loss)

Retained
Earnings

Total
Stockholders’Equity13,242 $67
061,774 $
8
9,370(1,623) $00191,484 $00251,635
8
9,370

0
(231)
0
0
13,078 $(5,329)(1,421)0064,402 $000(4,205)(5,828) $(1)(27,076)
32,4380
196,845 $(5,330)(28,497)
32,438(4,205)
255,419

8

Table of Contents

Alphabet Inc.
Three Months Ended June 30, 2023
Class A, Class B, Class C Stockand Additional Paid-In Capital
SharesBalance as of March 31, 2023
Stock issued
Stock-based compensation expense
Tax withholding related to vesting ofrestricted stock units and other
Repurchases of stock
Net income
Other comprehensive income (loss)
Balance as of June 30, 2023

AmountAccumulated
Other
Comprehensive
Income (Loss)

Retained
Earnings

Total
Stockholders’Equity12,722 $38
070,269 $0
5,815(6,000) $00

196,625 $00260,894
0
5,815

0
(131)
0
0
12,629 $(2,831)(1,005)0072,248 $000
9(5,991) $0(14,109)18,3680200,884 $(2,831)(15,114)18,3689267,141

Six Months Ended June 30, 2023
Class A, Class B, Class C Stockand Additional Paid-In Capital
SharesBalance as of December 31, 2022
Stock issued
Stock-based compensation expense
Tax withholding related to vesting ofrestricted stock units and other
Repurchases of stock
Net income
Other comprehensive income (loss)
Balance as of June 30, 2023

AmountAccumulated
Other
Comprehensive
Income (Loss)

Retained
Earnings

Total
Stockholders’Equity12,849 $68
068,184 $0
11,128(7,603) $00195,563 $00

256,144
0
11,1280(288)
0012,629 $(4,924)(2,140)0072,248 $

0
0
0
1,612
(5,991) $0(28,098)
33,4190200,884 $(4,924)(30,238)
33,4191,612
267,141

See accompanying notes.

9

Table of Contents

Alphabet Inc.
Alphabet Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS(in millions; unaudited)
Six Months Ended
June 30,
2022
2023

Operating activities
Net income
Adjustments:
Depreciation and impairment of property and equipment
Amortization and impairment of intangible assets
Stock-based compensation expense
Deferred income taxes
Loss (gain) on debt and equity securities, net
Other
Changes in assets and liabilities, net of effects of acquisitions:
Accounts receivable, net
Income taxes, net
Other assets
Accounts payable
Accrued expenses and other liabilities
Accrued revenue share
Deferred revenue
Net cash provided by operating activities
Investing activities
Purchases of property and equipment
Purchases of marketable securities
Maturities and sales of marketable securities
Purchases of non-marketable securities
Maturities and sales of non-marketable securities
Acquisitions, net of cash acquired, and purchases of intangible assets
Other investing activities
Net cash used in investing activities
Financing activities
Net payments related to stock-based award activities
Repurchases of stock
Proceeds from issuance of debt, net of costs
Repayments of debt
Proceeds from sale of interest in consolidated entities, net
Net cash used in financing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period
See accompanying notes.

10

$

$

32,438$33,419

7,289
392
9,286
(4,237)
2,478
202

6,339
244
11,058(4,269)
425
650

2,395
(253)
(1,621)(1,172)(1,719)(942)(8)
44,5281,506
8,520(1,259)14(4,037)(418)(17)
52,175(16,614)(50,199)
55,374(1,264)125(1,236)576(13,177)(35,589)
37,049(1,513)
181
(340)
(357)

(13,238)(13,746)(5,180)(28,497)
29,228(29,582)0(34,031)(268)(3,009)20,945
17,936 $(4,725)(29,526)
8,050(8,207)
5(34,403)
24
4,050
21,87925,929

Table of Contents

Alphabet Inc.
Alphabet Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Unaudited)

Note 1.

Summary of Significant Accounting Policies

Nature of Operations
Google was incorporated in California in September 1998 and re-incorporated in the State of Delaware in August
2003. In 2015, we implemented a holding company reorganization, and as a result, Alphabet Inc. ("Alphabet")
became the successor issuer to Google.
We generate revenues by delivering relevant, cost-effective online advertising; cloud-based solutions thatprovide enterprise customers with infrastructure and platform services as well as communication and collaboration
tools; sales of other products and services, such as apps and in-app purchases, and hardware; and fees received
for subscription-based products.
Basis of Consolidation
The consolidated financial statements of Alphabet include the accounts of Alphabet and entities consolidated
under the variable interest and voting models. Intercompany balances and transactions have been eliminated.
Unaudited Interim Financial Information
These unaudited interim consolidated financial statements have been prepared in accordance with generally
accepted accounting principles in the United States (GAAP), and in our opinion, include all adjustments of a normalrecurring nature necessary for fair financial statement presentation. Interim results are not necessarily indicative of
the results to be expected for the full year ending December 31, 2023. We have made estimates and assumptions
that affect the amounts reported and disclosed in the financial statements and the accompanying notes. Actual
results could differ materially from these estimates.
These consolidated financial statements and other information presented in this Form 10-Q should be read in
conjunction with the consolidated financial statements and the related notes included in our Annual Report on Form
10-K for the fiscal year ended December 31, 2022 filed with the SEC.
Change in Accounting Estimate
In January 2023, we completed an assessment of the useful lives of our servers and network equipment andadjusted the estimated useful life of our servers from four years to six years and the estimated useful life of certain
network equipment from five years to six years. This change in accounting estimate was effective beginning in fiscal
year 2023. Based on the carrying value of servers and certain network equipment as of December 31, 2022, andthose placed in service during the six months ended June 30, 2023, the effect of this change in estimate was a
reduction in depreciation expense of $966 million and $2.0 billion and an increase in net income of $752 million and$1.5 billion, or $0.06 and $0.12 per basic and $0.06 and $0.12 per diluted share, for the three and six months ended
June 30, 2023, respectively.
Prior Period Reclassifications
Certain amounts in prior periods have been reclassified to conform with current period presentation.

11

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Note 2.

Alphabet Inc.

Revenues

Disaggregated Revenues
The following table presents revenues disaggregated by type (in millions):Three Months Ended

Six Months Ended

June 30,

Google Search & other
YouTube ads
Google Network
Google advertising
Google other
Google Services total
Google Cloud
Other Bets
Hedging gains (losses)
Total revenues$$

June 30,

2022

2023

2022

40,689 $
7,340
8,259
56,288
6,553
62,841
6,276
193
375
69,685 $42,628 $
7,665
7,850
58,1438,142
66,2858,031
285
374,604 $80,307
14,20916,433110,949
13,364
124,313
12,097633
653
137,696

2023

$

$

82,987
14,35815,346112,691
15,555
128,246
15,485573
87
144,391

The following table presents revenues disaggregated by geography, based on the addresses of our customers(in millions):Three Months Ended

Six Months Ended

June 30,

June 30,

2022

United States
EMEA(1)
APAC(1)Other Americas(1)Hedging gains (losses)
Total revenues(1)$ 32,727
20,533
11,7104,340
375$ 69,685

2023

47 % $ 35,073
29
22,2891712,7286
4,511
1
3
100 % $ 74,6042022

47 % $ 64,460
30
40,85017
23,551
6
8,182
0
653
100 % $ 137,696

2023

47 % $ 67,937
30
43,36717
24,4096
8,591
087
100 % $ 144,391

47 %
30
17
6
0
100 %

Regions represent Europe, the Middle East, and Africa (EMEA); Asia-Pacific (APAC); and Canada and Latin America("Other Americas").

Revenue Backlog
As of June 30, 2023, we had $60.6 billion of remaining performance obligations (“revenue backlog”), primarily
related to Google Cloud. Our revenue backlog represents commitments in customer contracts for future services
that have not yet been recognized as revenue. The amount and timing of revenue recognition for thesecommitments is largely driven by our ability to deliver in accordance with relevant contract terms and when ourcustomers utilize services, which could affect our estimate of revenue backlog and when we expect to recognize
such as revenue. We expect to recognize approximately half of the revenue backlog as revenues over the next 24
months with the remaining to be recognized thereafter. Revenue backlog includes related deferred revenue
currently recorded as well as amounts that will be invoiced in future periods, and excludes contracts with an original
expected term of one year or less and cancellable contracts.
Deferred Revenues
We record deferred revenues when cash payments are received or due in advance of our performance,
including amounts which are refundable. Deferred revenues primarily relate to Google Cloud and Google other.
Total deferred revenue as of December 31, 2022 was $4.5 billion, of which $2.1 billion was recognized as revenues
during the six months ended June 30, 2023.

12

Table of Contents
Note 3.

Alphabet Inc.

Financial Instruments

Fair Value Measurements
Investments Measured at Fair Value on a Recurring Basis
Cash, cash equivalents, and marketable equity securities are measured at fair value and classified within
Level 1 and Level 2 in the fair value hierarchy, because we use quoted prices for identical assets in active markets
or inputs that are based upon quoted prices for similar instruments in active markets.
Debt securities are measured at fair value and classified within Level 2 in the fair value hierarchy, because weuse quoted market prices to the extent available or alternative pricing sources and models utilizing market
observable inputs to determine fair value. For certain marketable debt securities, we have elected the fair value
option for which changes in fair value are recorded in other income (expense), net. The fair value option waselected for these securities to align with the unrealized gains and losses from related derivative contracts.
The following tables summarize our cash, cash equivalents, and marketable securities measured at fair value
on a recurring basis (in millions):
As of December 31, 2022
Fair Value
Hierarchy

Adjusted
Cost

Gross
Unrealized
Gains

Gross
Unrealized
Losses$$Fair Value

Cash andCash
Equivalents

Marketable
Securities

$

$

$

Fair value changes
recorded in othercomprehensive
incomeTime deposits

Level 2Government bonds

Level 2

Corporate debt
securities

Level 2Mortgage-backed andasset-backed
securities$

Level 2

Total investmentswith fair valuechange reflected inothercomprehensive
income(1)

$

5,297

0

0

5,297

5,293

4

41,03664(2,045)39,055283

38,772

28,578

8(1,569)27,0171

27,016

16,176

5(1,242)

14,9390

14,939(4,856) $86,308

$

5,577

$

80,731

$

7,234

$

7,234

$

0

91,087$

77$

Fair value
adjustments
recorded in net
incomeMoney market funds

Level 1

Current marketable
equity securities(2)Level 1

4,013

0

4,013

Mutual funds

Level 2

339

0

339

Government bonds

Level 2

1,877

440

1,437

Corporate debt
securities

Level 2

3,744

65

3,679

Mortgage-backed andasset-backed
securities

Level 2
1,686

2

1,684

Total investmentswith fair valuechange recorded in
net income$

18,893(4,856) $105,201

Cash
Total
(1)

(2)

$

7,741

$

21,8790$

91,087

$

77

$

$

11,152$

91,8838,561

0Represents gross unrealized gains and losses for debt securities recorded to accumulated other comprehensive income(AOCI).
The long-term portion of marketable equity securities (subject to long-term lock-up restrictions) of $803 million as ofDecember 31, 2022 is included within other non-current assets.

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As of June 30, 2023
Fair Value
Hierarchy

Adjusted
Cost

Gross
Unrealized
Gains

Gross
Unrealized
Losses$$Fair Value

Cash andCash
Equivalents

Marketable
Securities

$

$

$

Fair value changes
recorded in othercomprehensive
incomeTime deposits

Level 2Government bonds

Level 2

Corporate debt
securities

Level 2Mortgage-backed andasset-backed
securities$

Level 2

Total investmentswith fair valuechange reflected inothercomprehensive
income(1)

$

2,913

0

0

2,913

0

45,33949(1,588)23,4808(1,162)

18,047

4(1,092)

16,959(3,842) $85,998

$

5,394

$

80,604

$

9,472

$

9,472

$

0

89,779$61$

43,8002,913

22,3262,481

41,3190

22,3260

16,959Fair value
adjustments
recorded in net
incomeMoney market funds

Level 1

Current marketable
equity securities(2)Level 1

Mutual funds

Level 2

315

0

315

Government bonds

Level 2

2,158

546

1,612

Corporate debt
securities

Level 2

3,831

2

3,829

Mortgage-backed andasset-backed
securities

Level 2
1,955

0

1,955

4,088

Total investmentswith fair valuechange recorded in
net income$

21,819(3,842) $107,817

Cash
Total
(1)
(2)

0

$

0
$

89,779$61$

10,020

4,088$

11,799$92,403

10,515$25,9290

Represents gross unrealized gains and losses for debt securities recorded to AOCI.
The long-term portion of marketable equity securities (subject to long-term lock-up restrictions) of $892 million as ofJune 30, 2023 is included within other non-current assets

Investments Measured at Fair Value on a Nonrecurring Basis
Our non-marketable equity securities are investments in privately held companies without readily determinable
market values. The carrying value of our non-marketable equity securities is adjusted to fair value upon observabletransactions for identical or similar investments of the same issuer or impairment. Non-marketable equity securities
that have been remeasured during the period based on observable transactions are classified within Level 2 orLevel 3 in the fair value hierarchy because we estimate the value based on valuation methods which may include a
combination of the observable transaction price at the transaction date and other unobservable inputs including
volatility, rights, and obligations of the securities we hold. The fair value of non-marketable equity securities thathave been remeasured due to impairment are classified within Level 3.
As of June 30, 2023 the carrying value of our non-marketable equity securities was $29.1 billion, of which $1.5
billion were remeasured at fair value during the three months ended June 30, 2023 and primarily classified as Level
3.

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Debt Securities
The following table summarizes the estimated fair value of investments in available-for-sale marketable debt
securities by effective contractual maturity dates (in millions):
As ofJune 30, 2023$

Due in 1 year or lessDue in 1 year through 5 years
Due in 5 years through 10 years
Due after 10 years
Total

15,40343,74915,162
13,68688,000$The following tables present fair values and gross unrealized losses recorded to AOCI, aggregated byinvestment category and the length of time that individual securities have been in a continuous loss position (inmillions):
As of December 31, 2022
Less than 12 Months

Government bonds
Corporate debt securities
Mortgage-backed and asset-backed
securities
Total

Fair Value

Unrealized
Loss$ 21,039
11,228
7,725$ 39,992

12 Months or Greater

Total
Fair Value

Unrealized
Loss$ (1,004) $ 13,438(440)
15,125$ (1,041) $ 34,477(1,052)
26,353$ (2,045)(1,492)

(585)
6,964
$ (2,029) $ 35,527(657)
14,689$ (2,750) $ 75,519(1,242)$ (4,779)

Fair Value

Unrealized
Loss

As of June 30, 2023
Less than 12 Months
Fair Value

Government bonds
Corporate debt securities
Mortgage-backed and asset-backed
securities
Total$ 19,195
3,915
6,352
$ 29,462

Unrealized
Loss

$

$

12 Months or Greater

Total
Fair Value

Unrealized
Loss(580) $ 13,976(69)
17,573$ (1,008) $ 33,171(1,008)21,488$ (1,588)(1,077)(153)
10,095(802) $ 41,644(939)
16,447$ (2,955) $ 71,106(1,092)$ (3,757)

Fair Value

Unrealized
Loss

We determine realized gains or losses on the sale or extinguishment of debt securities on a specificidentification method. The following table summarizes gains and losses for debt securities, reflected as acomponent of other income (expense), net (in millions):Three Months Ended

Six Months Ended

June 30,
2022

June 30,
2023

2022

2023

Unrealized gain (loss) on fair value option debt securities$

Gross realized gain on debt securities
Gross realized loss on debt securities(Increase) decrease in allowance for credit losses
Total gain (loss) on debt securities recognized in otherincome (expense), net(367) $
29
(368)
(84)

(24) $
28
(303)
(5)

(569) $
69
(639)
(18)

121
85
(795)
(8)

$

(790) $

(304) $

(1,157) $

(597)

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Alphabet Inc.

Equity Investments
The carrying value of equity securities is measured as the total initial cost plus the cumulative net gain (loss).
Our share of gains and losses, including impairments, are included as a component of other income (expense), net,in the Consolidated Statements of Income. See Note 6 for further details on other income (expense), net.
The carrying values for marketable and non-marketable equity securities are summarized below (in millions):
As of December 31, 2022
Marketable
EquitySecurities

Total initial cost
Cumulative net gain (loss)(1)
Carrying value
(1)

$
$

5,764 $
(608)
5,156 $

NonMarketable
EquitySecurities

As of June 30, 2023
Marketable
EquitySecurities

Total

16,157
12,372
28,529$$21,921 $
11,76433,685 $NonMarketable
EquitySecurities

5,647 $
(352)
5,295 $

Total

17,261 $
11,86829,129 $22,908
11,51634,424Non-marketable equity securities cumulative net gain (loss) is comprised of $16.8 billion gains and $4.5 billion losses(including impairments) as of December 31, 2022 and $17.8 billion gains and $5.9 billion losses (including impairments) as
of June 30, 2023.

Gains and Losses on Marketable and Non-marketable Equity Securities
Gains and losses (including impairments), net, for marketable and non-marketable equity securities included inother income (expense), net are summarized below (in millions):Three Months Ended

Six Months Ended

June 30,
2022

Realized net gain (loss) on equity securities sold during
the period$

Unrealized net gain (loss) on marketable equity securities
Unrealized net gain (loss) on non-marketable equity
securities(1)Total gain (loss) on equity securities in other income(expense), net(1)

June 30,2023

26 $(1,188)

$

2022

2023

87 $
397

(230) $
(2,462)

292
349

911

(689)

1,371

(469)

(251) $

(205) $

(1,321) $172

Unrealized gain (loss) on non-marketable equity securities accounted for under the measurement alternative is comprisedof $2.2 billion and $75 million of upward adjustments and $1.3 billion and $789 million of downward adjustments (including
impairments) for three months ended June 30, 2022 and 2023, respectively, and $3.0 billion and $989 million of upward
adjustments and $1.6 billion and $1.5 billion of downward adjustments (including impairments) for the six months ended
June 30, 2022 and 2023, respectively.

In the table above, realized net gain (loss) on equity securities sold during the period reflects the difference
between the sale proceeds and the carrying value of the equity securities at the beginning of the period or thepurchase date, if later.
Cumulative net gains (losses) on equity securities sold during the period, which is summarized in the following
table (in millions), represents the total net gains (losses) recognized after the initial purchase date of the equity
security sold during the period. While these net gains (losses) may have been reflected in periods prior to the periodof sale, we believe they are important supplemental information as they reflect the economic net gains (losses) on
the securities sold during the period. Cumulative net gains (losses) are calculated as the difference between thesale price and the initial purchase price for the equity security sold during the period.
Equity Securities SoldThree Months Ended

Six Months Ended

June 30,2022

Total sale priceTotal initial cost
Cumulative net gain (loss)

$
$

16

June 30,
2023

645
168
477

$
$

2022

427 $
156
271 $

1,335 $
428
907 $

2023

739
367
372

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Alphabet Inc.

Equity Securities Accounted for Under the Equity Method
As of December 31, 2022 and June 30, 2023 equity securities accounted for under the equity method had acarrying value of approximately $1.5 billion for both periods. Our share of gains and losses, including impairments,
are included as a component of other income (expense), net, in the Consolidated Statements of Income. See Note
6 for further details on other income (expense), net.
Derivative Financial Instruments
We use derivative instruments to manage risks relating to our ongoing business operations. The primary risk
managed is foreign exchange risk. We use foreign currency contracts to reduce the risk that our cash flows,
earnings, and investment in foreign subsidiaries will be adversely affected by foreign currency exchange rate
fluctuations. We also enter into derivative instruments to partially offset our exposure to other risks and enhanceinvestment returns.
We recognize derivative instruments in the Consolidated Balance Sheets at fair value and classify thederivatives primarily within Level 2 in the fair value hierarchy. We present our collar contracts (an option strategy
comprised of a combination of purchased and written options) at net fair values and present all other derivatives atgross fair values. The accounting treatment for derivatives is based on the intended use and hedge designation.
Cash Flow Hedges
We designate foreign currency forward and option contracts (including collars) as cash flow hedges to hedge
certain forecasted revenue transactions denominated in currencies other than the U.S. dollar. These contracts havematurities of 24 months or less.
Cash flow hedge amounts included in the assessment of hedge effectiveness are deferred in AOCI andsubsequently reclassified to revenue when the hedged item is recognized in earnings. We exclude forward points
and time value from our assessment of hedge effectiveness and amortize them on a straight-line basis over the lifeof the hedging instrument in revenues. The difference between fair value changes of the excluded component andthe amount amortized to revenues is recorded in AOCI.
As of June 30, 2023 the net accumulated gain on our foreign currency cash flow hedges before tax effect was$24 million, which is expected to be reclassified from AOCI into revenues within the next 12 months.
Fair Value Hedges
We designate foreign currency forward contracts as fair value hedges to hedge foreign currency risks for ourmarketable securities denominated in currencies other than the U.S. dollar. Fair value hedge amounts included in
the assessment of hedge effectiveness are recognized in other income (expense), net, along with the offsetting
gains and losses of the related hedged items. We exclude forward points from the assessment of hedge
effectiveness and recognize changes in the excluded component in other income (expense), net.
Net Investment Hedges
We designate foreign currency forward contracts as net investment hedges to hedge the foreign currency risks
related to our investment in foreign subsidiaries. Net investment hedge amounts included in the assessment ofhedge effectiveness are recognized in AOCI along with the foreign currency translation adjustment. We exclude
forward points from the assessment of hedge effectiveness and recognize changes in the excluded component inother income (expense), net.
Other Derivatives
We enter into foreign currency forward and option contracts that are not designated as hedging instruments tohedge intercompany transactions and other monetary assets or liabilities denominated in currencies other than thefunctional currency of a subsidiary. Gains and losses on these derivatives that are not designated as accounting
hedges are primarily recorded in other income (expense), net along with the foreign currency gains and losses onmonetary assets and liabilities.
We also use derivatives not designated as hedging instruments to manage risks relating to interest rates,
commodity prices, credit exposures, and to enhance investment returns. From time to time, we enter into derivatives
to hedge the market price risk on certain of our marketable equity securities. Gains and losses arising from otherderivatives are primarily reflected within the “other” component of other income (expense), net. See Note 6 forfurther details.

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Alphabet Inc.

The gross notional amounts of outstanding derivative instruments were as follows (in millions):
As of December 31,
2022

As of June 30, 2023$$$

15,972
2,117
8,751

$
$
$

15,823
1,472
9,371

$
$

34,9797,932$$

34,185
9,133

Derivatives designated as hedging instruments:
Foreign exchange contracts
Cash flow hedges
Fair value hedges
Net investment hedges
Derivatives not designated as hedging instruments:
Foreign exchange contracts
Other contracts

The fair values of outstanding derivative instruments were as follows (in millions):
As of December 31, 2022
Assets(1)Derivatives designated as hedging instruments:
Foreign exchange contracts
Derivatives not designated as hedging instruments:
Foreign exchange contracts
Other contracts
Total derivatives not designated as hedging instruments
Total
(1)
(2)

As of June 30, 2023

Liabilities(2)Assets(1)Liabilities(2)

$

271

$

556 $

228

$

201

$

365
40
405
676 $

207
47
254
810 $

130
39
169
397 $

136
67
203
404

Derivative assets are recorded as other current and non-current assets in the Consolidated Balance Sheets.
Derivative liabilities are recorded as accrued expenses and other liabilities, current and non-current in the Consolidated
Balance Sheets.

The gains (losses) on derivatives in cash flow hedging and net investment hedging relationships recognized inother comprehensive income (OCI) are summarized below (in millions):
Gains (Losses) Recognized in OCI on Derivatives Before Tax
EffectThree Months Ended

Six Months Ended

June 30,2022

Derivatives in cash flow hedging relationship:
Foreign exchange contracts
Amount included in the assessment of effectiveness$Amount excluded from the assessment of effectiveness
Derivatives in net investment hedging relationship:
Foreign exchange contracts
Amount included in the assessment of effectiveness
Total

18

$

June 30,2023

1,131 $

2022

2023

(39)

77 $
80

1,266 $
(54)

(61)
127

509

(59)

658
1,870 $

(274)
(208)

1,601 $

98 $

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Alphabet Inc.

The table below presents the gains (losses) of our derivatives on the Consolidated Statements of Income: (inmillions):
Gains (Losses) Recognized in Income
Three Months Ended
June 30,
2022
Revenues

Total amounts in the Consolidated Statements of Income $Effect of cash flow hedges:
Foreign exchange contracts
Amount reclassified from AOCI to income
Amount excluded from the assessment ofeffectiveness (amortized)
Effect of fair value hedges:
Foreign exchange contracts$

Hedged items
Derivatives designated as hedging instruments
Amount excluded from the assessment ofeffectiveness
Effect of net investment hedges:
Foreign exchange contracts
Amount excluded from the assessment ofeffectiveness
Effect of non designated hedges:
Foreign exchange contracts
Other contracts
Total gains (losses)

$

19

2023

Other income(expense), net

Other income(expense), net

Revenues

69,685$(439) $

400

$

0

$

74,604

$

65

(2) $

0

(24)

0

6

0

0
0

(136)
136

0
0

22
(22)

0

2

0

5

0

28

0

72

0
0
376

(149)
86
(33) $

0
0
4

124
(4)
197

$

$

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Alphabet Inc.
Gains (Losses) Recognized in Income
Six Months Ended
June 30,
2022
Revenues

Total amounts in the Consolidated Statements of Income
Effect of cash flow hedges:
Foreign exchange contracts
Amount of gains (losses) reclassified from AOCI toincomeAmount excluded from the assessment ofeffectiveness (amortized)
Effect of fair value hedges:
Foreign exchange contracts
Hedged items
Derivatives designated as hedging instruments
Amount excluded from the assessment ofeffectiveness
Effect of net investment hedges:
Foreign exchange contracts
Amount excluded from the assessment ofeffectiveness
Effect of non designated hedges:
Foreign exchange contracts
Other Contracts
Total gains (losses)

2023

Other income(expense), net$

137,696$(1,599) $

$

697

$

0

$

Other income(expense), net

Revenues$

144,391

$

855

86

$

0

(43)

0

2

0

0
0

(123)
124

0
0

54
(54)

0

3

0

10

0

40

0

123

0
0
654

(396)
124
(228) $

0
0
88

154
(1)
286

$

$

Offsetting of Derivatives
We enter into master netting arrangements and collateral security arrangements to reduce credit risk. Cashcollateral received related to derivative instruments under our collateral security arrangements are included in othercurrent assets with a corresponding liability. Cash and non-cash collateral pledged related to derivative instruments
under our collateral security arrangements are included in other current assets.
The gross amounts of derivative instruments subject to master netting arrangements with various
counterparties, and cash and non-cash collateral received and pledged under such agreements were as follows (inmillions):
As of December 31, 2022
Gross Amounts Not Offset in
the Consolidated Balance
Sheets, but Have Legal Rights
to Offset

Derivatives assets
Derivatives liabilities

Gross
Amounts
Recognized

Gross
Amounts
Offset in theConsolidated
Balance
Sheets

$
$

$
$

760
894

Net Amounts
Presented intheConsolidated
Balance
Sheets(84) $(84) $

20

Financial
Instruments(1)

676 $
810 $

Cash and
Non-CashCollateral
Received or
Pledged(463) $
(463) $Net Amounts(132) $
(28) $

81319

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Alphabet Inc.
As of June 30, 2023
Gross Amounts Not Offset in
the Consolidated Balance
Sheets, but Have Legal Rights
to Offset

Derivatives assets
Derivatives liabilities
(1)

Gross
Amounts
Recognized

Gross
Amounts
Offset in theConsolidated
Balance
Sheets

$
$

$
$

444
451

Net Amounts
Presented intheConsolidated
Balance
Sheets(47) $(47) $

Financial
Instruments(1)

397 $
404 $

Cash and
Non-CashCollateral
Received or
Pledged(138) $
(138) $Net Amounts(226) $
(34) $

33
232

The balances as of December 31, 2022 and June 30, 2023 were related to derivatives allowed to be net settled inaccordance with our master netting agreements.

Note 4.

Variable Interest Entities (VIE)

Consolidated VIEs
We consolidate VIEs in which we hold a variable interest and are the primary beneficiary. The results ofoperations and financial position of these VIEs are included in our consolidated financial statements.
For certain consolidated VIEs, their assets are not available to us and their creditors do not have recourse tous. As of December 31, 2022 and June 30, 2023, assets that can only be used to settle obligations of these VIEs
were $4.1 billion and $3.1 billion, respectively, and the liabilities for which creditors only have recourse to the VIEs
were $2.6 billion for both periods. We may continue to fund ongoing operations of certain VIEs that are included
within Other Bets.
Total noncontrolling interests (NCI) in our consolidated subsidiaries were $3.8 billion and $3.6 billion as ofDecember 31, 2022 and June 30, 2023, respectively, of which $1.1 billion is redeemable noncontrolling interest(RNCI) for both periods. NCI and RNCI are included within additional paid-in capital. Net loss attributable tononcontrolling interests was not material for any period presented and is included within the "other" component of
OI&E. See Note 6 for further details on OI&E.
Unconsolidated VIEs
We have investments in VIEs in which we are not the primary beneficiary. These VIEs include privatecompanies that are primarily early stage companies and certain renewable energy entities in which activities involve
power generation using renewable sources.
We have determined that the governance structures of these entities do not allow us to direct the activities thatwould significantly affect their economic performance. Therefore, we are not the primary beneficiary, and the resultsof operations and financial position of these VIEs are not included in our consolidated financial statements. We
account for these investments as non-marketable equity securities or equity method investments.
The maximum exposure of these unconsolidated VIEs is generally based on the current carrying value of theinvestments and any future funding commitments. We have determined that the single source of our exposure tothese VIEs is our capital investments in them. The carrying value and maximum exposure of these unconsolidated
VIEs were $2.7 billion and $2.8 billion, respectively, as of December 31, 2022 and $3.0 billion and $3.0 billion,
respectively, as of June 30, 2023.
Note 5.

Debt

Short-Term Debt
We have a debt financing program of up to $10.0 billion through the issuance of commercial paper. Net
proceeds from this program are used for general corporate purposes. We had no commercial paper outstanding asof December 31, 2022 and June 30, 2023.
Our short-term debt balance also includes the current portion of certain long-term debt.

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Alphabet Inc.

Long-Term Debt
Total outstanding debt is summarized below (in millions, except percentages):
Maturity

Debt
2014-2020 Notes issuances
Future finance lease payments, net
and other (1)Total debt
Unamortized discount and debt
issuance costs

Coupon Rate

Effective Interest
Rate

As of
December 31,
2022

2024 - 2060 0.45% - 3.38% 0.57% - 3.38% $13,000

As ofJune 30, 2023$

13,0002,142
15,142

2,159
15,159

(143)

(137)

Less: Current portion of long-term
notes(2)0(999)

Less: Current portion future financelease payments, net and othercurrent debt(1)(2)
Total long-term debt

(298)
14,701 $(318)
13,705(1)(2)$

Future finance lease payments are net of imputed interest.
Total current portion of long-term debt is included within other accrued expenses and current liabilities. See Note 6 forfurther details.

The notes in the table above are fixed-rate senior unsecured obligations and generally rank equally with eachother. We may redeem the notes at any time in whole or in part at specified redemption prices. The effective interest
rates are based on proceeds received with interest payable semi-annually.
The total estimated fair value of the outstanding notes was approximately $9.9 billion and $10.1 billion as ofDecember 31, 2022 and June 30, 2023, respectively. The fair value was determined based on observable market
prices of identical instruments in less active markets and is categorized accordingly as Level 2 in the fair value
hierarchy.
Credit Facility
As of June 30, 2023, we had $10.0 billion of revolving credit facilities of which $4.0 billion expires in April 2024
and $6.0 billion expires in April 2028. The interest rates for all credit facilities are determined based on a formulausing certain market rates, as well as our progress toward the achievement of certain sustainability goals. No
amounts were outstanding under the credit facilities as of December 31, 2022 and June 30, 2023.
Note 6.

Supplemental Financial Statement Information

Accounts Receivable
The allowance for credit losses on accounts receivable was $754 million and $836 million as of December 31,
2022 and June 30, 2023, respectively.
Property and Equipment, Net
Property and equipment, net, consisted of the following (in millions):
As of
December 31, 2022

Land and buildings
Information technology assets
Construction in progress
Leasehold improvements
Furniture and fixtures
Property and equipment, gross
Less: accumulated depreciation
Property and equipment, net

$

$

22

66,897 $66,26727,657
10,575314
171,710(59,042)
112,668 $As ofJune 30, 2023

68,89071,59232,01911,286
338
184,125(62,917)
121,208

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Alphabet Inc.

Accrued Expenses and Other Current Liabilities
Accrued expenses and other current liabilities consisted of the following (in millions):
As of
December 31, 2022

European Commission fines(1)Income taxes payable, net(2)Accrued customer liabilities
Accrued purchases of property and equipment
Current operating lease liabilities
Other accrued expenses and current liabilities
Accrued expenses and other current liabilities
(1)

(2)

$

9,106
1,632
3,619
3,019
2,477
18,01337,866$

As ofJune 30, 2023

$

9,446
10,870
3,498
3,380
2,663
19,44349,300$

While each EC decision is under appeal, the fines are included in accrued expenses and other current liabilities on our
Consolidated Balance Sheets, as we provided bank guarantees (in lieu of a cash payment) for the fines. Amounts include
the effects of foreign exchange and interest. See Note 9 for further details.
Income taxes payable, net as of the quarter ended June 30, 2023 includes balances related to the 2023 Internal Revenue
Service (IRS) payment deferral relief made available to taxpayers headquartered in designated counties in California.

Accumulated Other Comprehensive Income (Loss)
Components of AOCI, net of income tax, were as follows (in millions):
Foreign
Currency
Translation
Adjustments

Balance as of December 31, 2021
Other comprehensive income (loss) before
reclassifications
Amounts excluded from the assessment of hedge
effectiveness recorded in AOCI
Amounts reclassified from AOCIOther comprehensive income (loss)
Balance as of June 30, 2022$$

(2,306) $$Other comprehensive income (loss) before
reclassifications
Amounts excluded from the assessment of hedge
effectiveness recorded in AOCI
Amounts reclassified from AOCIOther comprehensive income (loss)
Balance as of June 30, 2023

$

23

236

Unrealized
Gains(Losses) on
Cash Flow
Hedges

$

447

Total

$

(1,623)(1,626)(3,404)

1,083(3,947)00(1,626)(3,932) $0
381(3,023)(2,787) $

(54)
(585)
444
891 $

(54)
(204)
(4,205)(5,828)Foreign
Currency
Translation
Adjustments

Balance as of December 31, 2022

Unrealized
Gains(Losses) on
Available-forSale
Investments

Unrealized
Gains(Losses) on
Available-forSale
Investments

Unrealized
Gains(Losses) on
Cash Flow
HedgesTotal(4,142) $(3,477) $16$(7,603)

831

296

(50)

1,077

0
0
831
(3,311) $

0
490
786
(2,691) $

127
(82)
(5)
11 $

127
408
1,612
(5,991)

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Alphabet Inc.

The effects on net income of amounts reclassified from AOCI were as follows (in millions):
Gains (Losses) Reclassified from AOCI to the Consolidated
Statements of Income

AOCI Components

Location

Six Months Ended

June 30,

June 30,

2022

Unrealized gains (losses) on available-for-saleinvestments
Other income (expense), net
Benefit (provision) for income taxes
Net of income tax
Unrealized gains (losses) on cash flow hedges
Foreignexchange
contracts
Interest rate
contracts

Three Months Ended

$

2022

2023

(299) $
66
(233)(254) $
56(198)(489) $
108
(381)

(628)
138
(490)

400

(2)

697

86

1
6
5
(193) $

3
(115)
585
204 $

3
(7)
82
(408)

Revenue

Other income (expense), net
Benefit (provision) for income taxes
Net of income tax
Total amount reclassified, net of income tax

2023

1
(65)
336
103 $

$

Other Income (Expense), Net
Components of OI&E were as follows (in millions):Three Months Ended

Six Months Ended

June 30,2022

Interest income
Interest expense(1)Foreign currency exchange gain (loss), net
Gain (loss) on debt securities, net
Gain (loss) on equity securities, net
Performance fees
Income (loss) and impairment from equity method
investments, net
Other
Other income (expense), net
(1)

$

$

June 30,
2023

2022

2023

486 $
(83)
(260)
(790)
(251)
318

892 $
(43)
(268)
(304)
(205)
5

900 $
(166)
(333)
(1,157)(1,321)
551

1,689
(123)
(478)
(597)
172
123

(118)

(106)

(207)

(157)

134
(1,599) $

226
855

259
(439) $

94
65 $Interest expense is net of interest capitalized of $37 million and $47 million for the three months ended June 30, 2022 and2023, respectively, and $71 million and $87 million for the six months ended June 30, 2022 and 2023, respectively.

24

Table of Contents
Note 7.

Alphabet Inc.

Workforce Reduction and Other Initiatives

We have a company-wide effort underway to re-engineer our cost base. As part of this program, in January2023, we announced a reduction of our workforce. As a result, total employee severance and related charges
recorded during the six months ended June 30, 2023 were $2.0 billion, of which $2.0 billion and $1 million wererecorded during the three months ended March 31, 2023 and June 30, 2023, respectively.
In addition, we are taking actions to optimize our global office space. As a result, total charges recorded during
the six months ended June 30, 2023 were $633 million, of which $564 million and $69 million were recorded during
the three months ended March 31, 2023 and June 30, 2023, respectively. We may incur additional charges in the
future as we further evaluate our real estate needs.
These severance and office space charges are included within our consolidated statements of income asfollows (in millions):Three Months Ended June 30, 2023
Severance
and Related (1)Cost of revenues$

Office Space

Six Months Ended June 30, 2023
Severance
and Related (1)Total

Office Space

Total

(1) $

20 $

19 $

460 $

240 $

Research and development

(3)

14

11

832

261

1,093

Sales and marketing

(1)

23

22

444

58

502

General and administrative

6

12

18

259

74

333

1 $

69 $

70 $

1,995 $

633 $

2,628

Total charges
(1)

$

700

Severance includes amounts to be settled in cash, accounted for as one-time involuntary employee termination benefits,
and stock based compensation

For segment reporting, the substantial majority of these charges are included within unallocated corporate
costs in our segment results.
For the six months ended June 30, 2023, changes in liabilities resulting from the severance charges andrelated accruals were as follows (in millions):
Severance andRelatedBalance as of December 31, 2022$

(1)

Charges

1,566

Cash payments(1,423)(2)

Balance as of June 30, 2023
(1)
(2)

0

$

143

Excludes non-cash stock-based compensation of $429 million.
Included in Accrued compensation and benefits on the consolidated balance sheets.

Note 8.

Goodwill and Other Intangible Assets

Goodwill
Changes in the carrying amount of goodwill for the six months ended June 30, 2023 were as follows (inmillions):
GoogleServices

Balance as of December 31, 2022
Acquisitions
Foreign currency translation and other adjustments
Balance as of June 30, 2023

$

$

25

Google Cloud

20,847 $240
37
21,124 $

7,205
0
1
7,206

Other Bets

$

$

908 $
0
(28)
880 $

Total

28,960240
1029,210Table of Contents

Alphabet Inc.

Other Intangible Assets
Information regarding intangible assets was as follows (in millions):
As of December 31, 2022

Gross
Carrying
AmountPatents and developed
technology
Customer relationships
Trade names and otherTotal definite-lived intangible
assetsIndefinite-lived intangible
assetsTotal intangible assets

$

1,164
862
527
2,553

$

240
2,793

Net
Carrying
AmountAccumulated
Amortization

$

354
235
120

$

709

$

0
709

As of June 30, 2023

$

810 $
627
407

Gross
Carrying
AmountAccumulated
Amortization

Net
Carrying
Amount1,181 $
884
536

420 $
306
145

761
578
391

1,844

2,601

871

1,730

240
2,084 $

236
2,837 $

0
871 $

236
1,966

Amortization expense relating to intangible assets was $201 million and $118 million for the three months
ended June 30, 2022 and 2023, respectively, and $392 million and $244 million for the six months ended June 30,
2022 and 2023, respectively.
Expected amortization expense of definite-lived intangible assets held as of June 30, 2023 was as follows (inmillions):
Remainder of 2023
2024
2025
2026
2027
Thereafter
Total
Note 9.

$

$

239
468
338
261
176
248
1,730

Commitments and Contingencies

Commitments
We have content licensing agreements with future fixed or minimum guaranteed commitments of $11.5 billion
as of June 30, 2023, of which the majority is paid over seven years ending in the first quarter of 2030.
Indemnifications
In the normal course of business, including to facilitate transactions in our services and products and corporate
activities, we indemnify certain parties, including advertisers, Google Network partners, distribution partners,
customers of Google Cloud offerings, lessors, and service providers with respect to certain matters. We haveagreed to defend and/or hold certain parties harmless against losses arising from a breach of representations or
covenants, or out of intellectual property infringement or other claims made against certain parties. Several of these
agreements limit the time within which an indemnification claim can be made and the amount of the claim. In
addition, we have entered into indemnification agreements with our officers and directors, and our bylaws containsimilar indemnification obligations to our agents.
It is not possible to make a reasonable estimate of the maximum potential amount under these indemnificationagreements due to the unique facts and circumstances involved in each particular agreement. Additionally, thepayments we have made under such agreements have not had a material adverse effect on our results ofoperations, cash flows, or financial position. However, to the extent that valid indemnification claims arise in the
future, future payments by us could be significant and could have a material adverse effect on our results ofoperations or cash flows in a particular period.
As of June 30, 2023, we did not have any material indemnification claims that were probable or reasonably
possible.

26

Table of Contents

Alphabet Inc.

Legal Matters
We record a liability when we believe that it is probable that a loss has been incurred, and the amount can bereasonably estimated. If we determine that a loss is reasonably possible and the loss or range of loss can be
estimated, we disclose the reasonably possible loss. We evaluate developments in our legal matters that could
affect the amount of liability that has been previously accrued, and the matters and related reasonably possible
losses disclosed, and make adjustments as appropriate.
Certain outstanding matters seek speculative, substantial or indeterminate monetary amounts, substantialchanges to our business practices and products, or structural remedies. Significant judgment is required todetermine both the likelihood of there being a loss and the estimated amount of a loss related to such matters, andwe may be unable to estimate the reasonably possible loss or range of losses. The outcomes of outstanding legal
matters are inherently unpredictable and subject to significant uncertainties, and could, either individually or inaggregate, have a material adverse effect.
We expense legal fees in the period in which they are incurred.
Antitrust Investigations
On November 30, 2010, the EC's Directorate General for Competition opened an investigation into various
antitrust-related complaints against us.
On June 27, 2017, the EC announced its decision that certain actions taken by Google regarding its display
and ranking of shopping search results and ads infringed European competition law. The EC decision imposed a€2.4 billion ($2.7 billion as of June 27, 2017) fine. On September 11, 2017, we appealed the EC decision to theGeneral Court, and on September 27, 2017, we implemented product changes to bring shopping ads into
compliance with the EC's decision. We recognized a charge of $2.7 billion for the fine in the second quarter of 2017.
On November 10, 2021, the General Court rejected our appeal, and we subsequently filed an appeal with theEuropean Court of Justice on January 20, 2022.
On July 18, 2018, the EC announced its decision that certain provisions in Google’s Android-related distributionagreements infringed European competition law. The EC decision imposed a €4.3 billion ($5.1 billion as of June 30,2018) fine and directed the termination of the conduct at issue. On October 9, 2018, we appealed the EC decision,and on October 29, 2018, we implemented changes to certain of our Android distribution practices. On September
14, 2022, the General Court reduced the fine from €4.3 billion to €4.1 billion. We subsequently filed an appeal with
the European Court of Justice. In 2018, we recognized a charge of $5.1 billion for the fine, which we reduced by$217 million in 2022.
On March 20, 2019, the EC announced its decision that certain contractual provisions in agreements that
Google had with AdSense for Search partners infringed European competition law. The EC decision imposed a fineof €1.5 billion ($1.7 billion as of March 20, 2019) and directed actions related to AdSense for Search partners'
agreements, which we implemented prior to the decision. On June 4, 2019, we appealed the EC decision, which
remains pending. We recognized a charge of $1.7 billion for the fine in the first quarter of 2019.
From time to time we are subject to formal and informal inquiries and investigations on various competition
matters by regulatory authorities in the U.S., Europe, and other jurisdictions globally. For example:•

In August 2019, we began receiving civil investigative demands from the U.S. Department of Justice (DOJ)
requesting information and documents relating to our prior antitrust investigations and certain aspects of ourbusiness. The DOJ and a number of state Attorneys General filed a lawsuit in the U.S. District Court for theDistrict of Columbia on October 20, 2020 alleging that Google violated U.S. antitrust laws relating to Searchand Search advertising, and a trial is scheduled for September 2023. Further, in June 2022, the AustralianCompetition and Consumer Commission (ACCC) and the United Kingdom's Competition and Markets
Authority (CMA) each opened an investigation into Search distribution practices.

•

On December 16, 2020, a number of state Attorneys General filed an antitrust complaint in the U.S. District
Court for the Eastern District of Texas, alleging that Google violated U.S. antitrust laws as well as state
deceptive trade laws relating to its advertising technology. Additionally, on January 24, 2023, the DOJ, alongwith a number of state Attorneys General, filed an antitrust complaint in the U.S. District Court for the
Eastern District of Virginia alleging that Google’s digital advertising technology products violate U.S.
antitrust laws, and on April 17, 2023, a number of additional state Attorneys General joined the complaint.
The EC, the CMA, and the ACCC each opened a formal investigation into Google's advertising technology
business practices on June 22, 2021, May 25, 2022, and June 29, 2022, respectively. On June 14, 2023,
27

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Alphabet Inc.

the EC issued a Statement of Objections (SO) informing Google of its preliminary view that Google violated
European antitrust laws relating to its advertising technology. We will respond to the SO by December 31,
2023.
•

On July 7, 2021, a number of state Attorneys General filed an antitrust complaint in the U.S. District Court
for the Northern District of California, alleging that Google’s operation of Android and Google Play violated
U.S. antitrust laws and state antitrust and consumer protection laws. In May 2022, the EC and the CMA
each opened investigations into Google Play’s business practices. Korean regulators are investigating
Google Play's billing practices, most recently opening a formal review in May 2022 of Google's compliancewith the new app store billing regulations.

We believe these complaints are without merit and will defend ourselves vigorously. We continue to cooperatewith federal and state regulators in the U.S., the EC, and other regulators around the world.
Patent and Intellectual Property Claims
We have had patent, copyright, trade secret, and trademark infringement lawsuits filed against us claiming thatcertain of our products, services, and technologies infringe others' intellectual property rights. Adverse results inthese lawsuits may include awards of substantial monetary damages, costly royalty or licensing agreements, ororders preventing us from offering certain features, functionalities, products, or services. As a result, we may haveto change our business practices and develop non-infringing products or technologies, which could result in a lossof revenues for us and otherwise harm our business. In addition, the U.S. International Trade Commission (ITC) has
increasingly become an important forum to litigate intellectual property disputes because an ultimate loss in an ITC
action can result in a prohibition on importing infringing products into the U.S. Because the U.S. is an important
market, a prohibition on importation could have an adverse effect on us, including preventing us from importing
many important products into the U.S. or necessitating workarounds that may limit certain features of our products.
Furthermore, many of our agreements with our customers and partners require us to indemnify them against
certain intellectual property infringement claims, which would increase our costs as a result of defending suchclaims, and may require that we pay significant damages if there were an adverse ruling in any such claims. In
addition, our customers and partners may discontinue the use of our products, services, and technologies, as aresult of injunctions or otherwise, which could result in loss of revenues and adversely affect our business.
Other
We are subject to claims, lawsuits, regulatory and government investigations, other proceedings, and consent
orders involving competition, intellectual property, data privacy and security, tax and related compliance, labor andemployment, commercial disputes, content generated by our users, goods and services offered by advertisers or
publishers using our platforms, personal injury, consumer protection, and other matters. For example, we currently
have a number of privacy investigations and lawsuits ongoing in multiple jurisdictions. We also periodically havedata incidents that we report to relevant regulators as required by law. Such claims, lawsuits, regulatory andgovernment investigations, other proceedings, and consent orders could result in substantial fines and penalties,
injunctive relief, ongoing monitoring and auditing obligations, changes to our products and services, alterations toour business models and operations, and collateral related civil litigation or other adverse consequences, all ofwhich could harm our business, reputation, financial condition, and operating results.
We have ongoing legal matters relating to Russia. For example, civil judgments that include compounding
penalties have been imposed upon us in connection with disputes regarding the termination of accounts, including
those of sanctioned parties. We do not believe these ongoing legal matters will have a material adverse effect.
Non-Income Taxes
We are under audit by various domestic and foreign tax authorities with regards to non-income tax matters.
The subject matter of non-income tax audits primarily arises from disputes on the tax treatment and tax rate applied
to the sale of our products and services in these jurisdictions and the tax treatment of certain employee benefits. We
accrue non-income taxes that may result from examinations by, or any negotiated agreements with, these tax
authorities when a loss is probable and reasonably estimable. If we determine that a loss is reasonably possible andthe loss or range of loss can be estimated, we disclose the reasonably possible loss. Due to the inherent complexity
and uncertainty of these matters and judicial process in certain jurisdictions, the final outcome may be materiallydifferent from our expectations.
For information regarding income tax contingencies, see Note 13.

28

Table of Contents
Note 10.

Alphabet Inc.

Stockholders' Equity

Share Repurchases
In the three and six months ended June 30, 2023, we repurchased $15.1 billion and $30.2 billion, respectively,of Alphabet's Class A and Class C shares.
In April 2022, the Board of Directors of Alphabet authorized the company to repurchase up to $70.0 billion of its
Class A and Class C shares. The repurchases from the April 2022 authorization were completed during the second
quarter of 2023. In April 2023, the Board of Directors of Alphabet authorized the company to repurchase up to an
additional $70.0 billion of its Class A and Class C shares. As of June 30, 2023, $68.1 billion remains available forClass A and Class C share repurchases.
The following table presents Class A and Class C shares repurchased and subsequently retired (in millions):Three Months Ended June 30,
2023
Shares

(1)

Amount

17 $
114
131 $

Class A share repurchases
Class C share repurchases
Total share repurchases(1)Six Months Ended June 30,
2023
Shares

1,908
13,20615,114

Amount

37 $
251
288 $

3,919
26,31930,238

Shares repurchased include unsettled repurchases as of June 30, 2023.

Class A and Class C shares are repurchased in a manner deemed in the best interest of the company and its
stockholders, taking into account the economic cost and prevailing market conditions, including the relative trading
prices and volumes of the Class A and Class C shares. Repurchases are executed from time to time, subject togeneral business and market conditions and other investment opportunities, through open market purchases or
privately negotiated transactions, including through Rule 10b5-1 plans. The repurchase program does not have an
expiration date.
Note 11.

Net Income Per Share

The following table sets forth the computation of basic and diluted net income per share of Class A, Class B,
and Class C stock (in millions, except per share amounts):
Three Months Ended June 30,
2022
Class A

2023

Class BClass CClass AClass BClass C

Basic net income per share:
Numerator
Allocation of undistributed earnings

$

7,329

$

1,081

$

7,592

$

8,600

$

1,275

$

8,493

Denominator
Number of shares used in per share computation
Basic net income per share

6,015

887

6,231

5,931

879

5,858

$

1.22

$

1.22

$

1.22

$

1.45

$

1.45

$

1.45

$

7,329

$

1,081

$

7,592

$

8,600

$

1,275

$

8,493

Diluted net income per share:
Numerator
Allocation of undistributed earnings for basic
computation
Reallocation of undistributed earnings as a result of
conversion of Class B to Class A shares
Reallocation of undistributed earnings
Allocation of undistributed earnings

$

1,081

0

0

1,275

0

0

(68)

(9)

68

(75)

(10)

75

8,342

$

1,072

$

7,660

$

9,800

$

1,265

$

8,568

Denominator
Number of shares used in basic computation

6,015

887

6,231

5,931

879

5,858

887

0

0

879

0

0

0

0

106

0

0

96

Weighted-average effect of dilutive securities
Add:
Conversion of Class B to Class A shares outstanding
Restricted stock units and other contingently
issuable shares
Number of shares used in per share computation
Diluted net income per share

6,902
$

1.21

29

887
$

1.21

6,337
$

1.21

6,810
$

1.44

879
$

1.44

5,954
$

1.44

Table of Contents

Alphabet Inc.
Six Months Ended June 30,
2022
Class A

2023

Class BClass CClass AClass BClass C

Basic net income per share:
Numerator
Allocation of undistributed earnings$

14,812

$

2,190

$

15,436$

15,597

$

2,311

$

15,511

Denominator
Number of shares used in per share computation
Basic net income per share

6,013

889

6,266

5,939

880

5,906

$

2.46

$

2.46

$

2.46

$

2.63

$

2.63

$

2.63

$

14,812

$

2,190

$

15,436$

15,597

$

2,311

$

15,511

Diluted net income per share:
Numerator
Allocation of undistributed earnings for basic
computation
Reallocation of undistributed earnings as a result of
conversion of Class B to Class A shares

2,190

0

0

2,311

0

0

Reallocation of undistributed earnings

(162)

(21)

162

(96)

(12)

96

Allocation of undistributed earnings$

16,840

$

2,169

$

15,598$17,812

$

2,299

$

15,607

Denominator
Number of shares used in basic computation

6,013

889

6,266

5,939

880

5,906

Weighted-average effect of dilutive securities
Add:
Conversion of Class B to Class A shares outstanding

889

0

0

880

0

0

Restricted stock units and other contingently
issuable shares

0

0

127

0

0

69

Number of shares used in per share computation

6,902

889

6,393

6,819

880

5,975

Diluted net income per share

$

2.44

$

2.44

$

2.44

$

2.61

$

2.61

$

2.61

For the periods presented above, the net income per share amounts are the same for Class A, Class B, andClass C stock because the holders of each class are entitled to equal per share dividends or distributions inliquidation in accordance with the Amended and Restated Certificate of Incorporation of Alphabet Inc.
Note 12.

Compensation Plans

Stock-Based Compensation
For the three months ended June 30, 2022 and 2023, total stock-based compensation (SBC) expense was$4.9 billion and $5.4 billion, including amounts associated with awards we expect to settle in Alphabet stock of $4.6
billion and $5.6 billion, respectively. For the six months ended June 30, 2022 and 2023, total SBC expense was$9.4 billion and $10.7 billion, including amounts associated with awards we expect to settle in Alphabet stock of $9.0
billion and $10.7 billion, respectively.
During the six months ended June 30, 2023, total SBC expense includes $429 million associated withworkforce reduction costs, of which $412 million and $17 million were recorded during the three months ended
March 31, 2023 and June 30, 2023, respectively. See Note 7 for further information.
Stock-Based Award Activities
The following table summarizes the activities for unvested Alphabet restricted stock units (RSUs) for the six
months ended June 30, 2023 (in millions, except per share amounts):
Unvested Restricted Stock Units
WeightedAverage
Grant-Date
Fair Value

Number of
SharesUnvested as of December 31, 2022

324
246
(109)
(19)
442

Granted
VestedForfeited/canceled
Unvested as of June 30, 2023

30

$
$
$
$
$

107.9895.30
99.65
108.30102.97

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Alphabet Inc.

As of June 30, 2023, there was $43.6 billion of unrecognized compensation cost related to unvested RSUs.
This amount is expected to be recognized over a weighted-average period of 2.8 years.
Note 13.

Income Taxes

The following table presents provision for income taxes (in millions, except for effective tax rate):
Three Months Ended

Six Months Ended

June 30,
2022

Income before provision for income taxes
Provision for income taxes
Effective tax rate

June 30,
2023

2022

2023

$ 19,014$ 21,903$ 37,948$ 40,108$ 3,012$ 3,535$ 5,510$ 6,68915.8 %
16.1 %
14.5 %
16.7 %We are subject to income taxes in the U.S. and foreign jurisdictions. Significant judgment is required in
evaluating our uncertain tax positions and determining our provision for income taxes. The total amount of grossunrecognized tax benefits was $7.1 billion and $8.8 billion as of December 31, 2022 and June 30, 2023,
respectively, of which $5.3 billion and $6.7 billion, if recognized, would affect our effective tax rate, respectively.
Note 14.

Information about Segments and Geographic Areas

We report our segment results as Google Services, Google Cloud, and Other Bets:•

Google Services includes products and services such as ads, Android, Chrome, hardware, Google Maps,
Google Play, Search, and YouTube. Google Services generates revenues primarily from advertising; salesof apps and in-app purchases, and hardware; and fees received for subscription-based products such as
YouTube Premium and YouTube TV.

•

Google Cloud includes infrastructure and platform services, collaboration tools, and other services forenterprise customers. Google Cloud generates revenues from fees received for Google Cloud Platform
services, Google Workspace communication and collaboration tools, and other enterprise services.

•

Other Bets is a combination of multiple operating segments that are not individually material. Revenues
from Other Bets are generated primarily from the sale of health technology and internet services.

Revenues, certain costs, such as costs associated with content and traffic acquisition, certain engineering
activities, and hardware, as well as certain operating expenses are directly attributable to our segments. Due to theintegrated nature of Alphabet, other costs and expenses, such as technical infrastructure and office facilities, aremanaged centrally at a consolidated level. These costs, including the associated depreciation and impairment, areallocated to operating segments as a service cost generally based on usage, headcount, or revenue.
Reflecting DeepMind's increasing collaboration with Google Services, Google Cloud, and Other Bets,
beginning in the first quarter of 2023 DeepMind is reported as part of Alphabet's unallocated corporate costs insteadof within Other Bets. Additionally, beginning in the first quarter of 2023, we updated and simplified our cost allocation
methodologies to provide our business leaders with increased transparency for decision-making. Prior periods havebeen recast to conform to the current presentation.
As announced on April 20, 2023, we brought together part of Google Research (the Brain team) and DeepMind
to significantly accelerate our progress in artificial intelligence (AI). The group, called Google DeepMind, is reported
within Alphabet's unallocated corporate costs prospectively beginning in the second quarter of 2023. Previously, theBrain team was included within Google Services.
Certain costs are not allocated to our segments because they represent Alphabet-level activities. These costs
primarily include AI-focused shared R&D activities; corporate initiatives such as our philanthropic activities;
corporate shared costs such as certain finance, human resource, and legal costs, including certain fines andsettlements. Charges associated with reductions in our workforce and office space announced in January 2023 are
not allocated to our segments. Additionally, hedging gains (losses) related to revenue are not allocated to oursegments.
Our operating segments are not evaluated using asset information.

31

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Alphabet Inc.

The following table presents information about our segments (in millions):Three Months Ended

Six Months Ended

June 30,
2022

Revenues:
Google Services
Google Cloud
Other Bets
Hedging gains (losses)
Total revenues$$

June 30,2023

62,841
6,276
193
375
69,685$$66,2858,031
285
374,6042022$$

Three Months Ended

124,313
12,097633
653
137,696

$

$

$

$

128,246
15,485573
87
144,391

Six Months Ended

June 30,

Operating income (loss):
Google Services
Google Cloud
Other Bets
Corporate costs, unallocatedTotal income from operations

2023

June 30,

2022

2023

2022

2023

21,621 $(590)(1,339)(239)
19,453 $23,454 $395(813)(1,198)21,838 $43,594 $(1,296)(2,174)(577)
39,547 $45,191586(2,038)(4,486)39,253For revenues by geography, see Note 2.
The following table presents long-lived assets by geographic area, which includes property and equipment, net
and operating lease assets (in millions):
As of
December 31, 2022

Long-lived assets:
United States
International
Total long-lived assets

$
$

32

93,56533,484
127,049

As ofJune 30, 2023$$

99,71435,963
135,677

Table of Contents
ITEM 2.

Alphabet Inc.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

Please read the following discussion and analysis of our financial condition and results of operations together
with "Note About Forward-Looking Statements" and our consolidated financial statements and related notes
included under Item 1 of this Quarterly Report on Form 10-Q as well as our Annual Report on Form 10-K for the
fiscal year ended December 31, 2022, including Part I, Item 1A "Risk Factors."
Understanding Alphabet’s Financial Results
Alphabet is a collection of businesses — the largest of which is Google. We report Google in two segments,
Google Services and Google Cloud; we also report all non-Google businesses collectively as Other Bets. For further
details on our segments, see Note 14 of the Notes to Consolidated Financial Statements included in Item 1 of thisQuarterly Report on Form 10-Q.
Revenues and Monetization Metrics
We generate revenues by delivering relevant, cost-effective online advertising; cloud-based solutions thatprovide enterprise customers of all sizes with infrastructure and platform services as well as communication andcollaboration tools; sales of other products and services, such as apps and in-app purchases, and hardware; andfees received for subscription-based products. For details on how we recognize revenue, see Note 1 of the Notes toConsolidated Financial Statements included in Part II, Item 8 in our Annual Report on Form 10-K for the fiscal year
ended December 31, 2022.
In addition to the long-term trends and their financial effect on our business noted in "Trends in Our Businessand Financial Effect" in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31,
2022, fluctuations in our revenues have been and may continue to be affected by a combination of factors,
including:•changes in foreign currency exchange rates;•changes in pricing, such as those resulting from changes in fee structures, discounts, and customer
incentives;•

general economic conditions and various external dynamics, including geopolitical events, regulations, andother measures and their effect on advertiser, consumer, and enterprise spending;•new product and service launches; and•seasonality.

Additionally, fluctuations in our revenues generated from advertising ("Google advertising"), revenues fromother sources ("Google other revenues"), Google Cloud, and Other Bets revenues have been and may continue tobe affected by other factors unique to each set of revenues, as described below.
Google Services
Google Services revenues consist of Google advertising as well as Google other revenues.
Google Advertising
Google advertising revenues are comprised of the following:•

Google Search & other, which includes revenues generated on Google search properties (including
revenues from traffic generated by search distribution partners who use Google.com as their default searchin browsers, toolbars, etc.), and other Google owned and operated properties like Gmail, Google Maps, andGoogle Play;•

YouTube ads, which includes revenues generated on YouTube properties; and•Google Network, which includes revenues generated on Google Network properties participating in AdMob,
AdSense, and Google Ad Manager.

We use certain metrics to track how well traffic across various properties is monetized as it relates to ouradvertising revenues: paid clicks and cost-per-click pertain to traffic on Google Search & other properties, while
impressions and cost-per-impression pertain to traffic on our Google Network properties.
Paid clicks represent engagement by users and include clicks on advertisements by end-users on Google
search properties and other Google owned and operated properties including Gmail, Google Maps, and Google

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Play. Cost-per-click is defined as click-driven revenues divided by our total number of paid clicks and represents theaverage amount we charge advertisers for each engagement by users.
Impressions include impressions displayed to users on Google Network properties participating primarily in
AdMob, AdSense, and Google Ad Manager. Cost-per-impression is defined as impression-based and click-based
revenues divided by our total number of impressions, and represents the average amount we charge advertisers foreach impression displayed to users.
As our business evolves, we periodically review, refine, and update our methodologies for monitoring,gathering, and counting the number of paid clicks and the number of impressions, and for identifying the revenues
generated by the corresponding click and impression activity.
Fluctuations in our advertising revenues, as well as the change in paid clicks and cost-per-click on Google
Search & other properties and the change in impressions and cost-per-impression on Google Network properties
and the correlation between these items have been and may continue to be affected by additional factors, such as:•advertiser competition for keywords;•

changes in advertising quality, formats, delivery or policy;•

changes in device mix;•

seasonal fluctuations in internet usage, advertising expenditures, and underlying business trends, such as
traditional retail seasonality; and•traffic growth in emerging markets compared to more mature markets and across various verticals andchannels.
Google Other
Google other revenues are comprised of the following:•

Google Play, which includes sales of apps and in-app purchases;•

hardware, which includes sales of Fitbit wearable devices, Google Nest home products, and Pixel devices;•

YouTube non-advertising, which includes subscription revenues from services such as YouTube Premium
and YouTube TV; and•other products and services.

Fluctuations in our Google other revenues have been and may continue to be affected by additional factors,
such as changes in customer usage and demand, number of subscribers, and fluctuations in the timing of productlaunches.
Google Cloud
Google Cloud revenues are comprised of the following:•

Google Cloud Platform, which includes fees for infrastructure, platform, and other services;•

Google Workspace, which includes fees for cloud-based communication and collaboration tools forenterprises, such as Gmail, Docs, Drive, Calendar and Meet; and•other enterprise services.

Fluctuations in our Google Cloud revenues have been and may continue to be affected by additional factors,
such as customer usage.
Other Bets
Revenues from Other Bets are generated primarily from the sale of health technology and internet services.
Costs and Expenses
Our cost structure has two components: cost of revenues and operating expenses. Our operating expenses
include costs related to R&D, sales and marketing, and general and administrative functions. Certain of our costs
and expenses, including those associated with the operation of our technical infrastructure as well as componentsof our operating expenses, are generally less variable in nature and may not correlate to changes in revenue.

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Cost of Revenues
Cost of revenues is comprised of TAC and other costs of revenues.
••

TAC includes:◦

Amounts paid to our distribution partners who make available our search access points andservices. Our distribution partners include browser providers, mobile carriers, original equipment
manufacturers, and software developers.

◦

Amounts paid to Google Network partners primarily for ads displayed on their properties.

Other cost of revenues includes:◦

Content acquisition costs, which are payments to content providers from whom we license video
and other content for distribution on YouTube and Google Play (we pay fees to these content
providers based on revenues generated or a flat fee).

◦

Expenses associated with our data centers (including bandwidth, compensation expenses,
depreciation, energy, and other equipment costs) as well as other operations costs (such as content
review as well as customer and product support costs).

◦

Inventory and other costs related to the hardware we sell.

TAC as a percentage of revenues generated from ads placed on Google Network properties are significantly
higher than TAC as a percentage of revenues generated from ads placed on Google Search & other properties,
because most of the advertiser revenues from ads served on Google Network properties are paid as TAC to our
Google Network partners.
Operating Expenses
Operating expenses are generally incurred during our normal course of business, which we categorize as
either R&D, sales and marketing, or general and administrative.
The main components of our R&D expenses are:•compensation expenses for engineering and technical employees responsible for R&D related to ourexisting and new products and services;•

depreciation; and•third-party services fees primarily relating to consulting and outsourced services in support of ourengineering and product development efforts.
The main components of our sales and marketing expenses are:•compensation expenses for employees engaged in sales and marketing, sales support, and certain
customer service functions; and•spending relating to our advertising and promotional activities in support of our products and services.
The main components of our general and administrative expenses are:•compensation expenses for employees in finance, human resources, information technology, legal, andother administrative support functions;•

expenses relating to legal matters, including fines and settlements; and•third-party services fees, including audit, consulting, outside legal, and other outsourced administrative
services.

Other Income (Expense), Net
Other income (expense), net primarily consists of interest income (expense), the effect of foreign currency
exchange gains (losses), net gains (losses) and impairment on our marketable and non-marketable securities,
performance fees, and income (loss) and impairment from our equity method investments.
For additional details, including how we account for our investments and factors that can drive fluctuations in
the value of our investments, see Note 1 of the Notes to Consolidated Financial Statements included in Part II, Item
8 and Item 7A, “Quantitative and Qualitative Disclosures About Market Risk” in our Annual Report on Form 10-K for35

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the fiscal year ended December 31, 2022 as well as Note 3 of the Notes to Consolidated Financial Statements
included in Item 1 of this Quarterly Report on Form 10-Q.
Provision for Income Taxes
Provision for income taxes represents the estimated amount of federal, state, and foreign income taxes
incurred in the U.S. and the many jurisdictions in which we operate. The provision includes the effect of reserve
provisions and changes to reserves that are considered appropriate as well as the related net interest and penalties.
For additional details, see Note 1 of the Notes to Consolidated Financial Statements included in Part II, Item 8
in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022 as well as Note 13 of the Notes toConsolidated Financial Statements included in Item 1 of this Quarterly Report on Form 10-Q.
Executive Overview
The following table summarizes our consolidated financial results (in millions, except per share informationand percentages):Three Months Ended
June 30,
2022

2023

Consolidated revenues
Change in consolidated constant currency revenues(1)$ 69,685$ 74,604

$

4,919

7%
9%

Cost of revenues
Operating expenses$ 30,104$ 20,128$ 31,916$ 20,850

$
$

1,812
722

6%
4%

Operating income
Operating margin$ 19,453$ 21,838
$
28 %
29 %

2,385

12 %
1%

Other income (expense), net$

Net Income
Diluted EPS$ 16,002
$
1.21

(439)

$

$ Change% Change

65

$

504

NM

$ 18,368
$
1.44

$
$

2,366
0.23

15 %
19 %

NM = Not Meaningful(1)

See "Use of Non-GAAP Constant Currency Measures" below for details relating to our use of constant currency
information.

•

Revenues were $74.6 billion, an increase of 7% year over year, primarily driven by an increase in Google
Services revenues of $3.4 billion, or 5%, and an increase in Google Cloud revenues of $1.8 billion, or 28%.

•

Total constant currency revenues, which exclude the effect of hedging, increased 9% year over year.

•

Cost of revenues was $31.9 billion, an increase of 6% year over year, primarily driven by an increase incontent acquisition costs and hardware costs. An overall increase in data center and other operations costs
was partially offset by a reduction in depreciation expense due to the change in estimated useful lives of ourservers and certain network equipment.

•

Operating expenses were $20.9 billion, an increase of 4% year over year, primarily driven by an increase incompensation expenses largely due to headcount growth, partially offset by a reduction in valuation-based
compensation liabilities related to certain Other Bets. Additionally, operating expenses benefited from a
reduction in depreciation expense due to the change in the estimated useful lives of our servers and certain
network equipment.

Other Information•

In January 2023, we announced a reduction of our workforce, and as a result we recorded employee
severance and related charges of $2.0 billion for the six months ended June 30, 2023. In addition, we aretaking actions to optimize our global office space. As a result, total charges recorded during the six months
ended June 30, 2023 were $633 million, of which $564 million and $69 million were recorded during thethree months ended March 31, 2023 and June 30, 2023, respectively. We may incur additional charges in36

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the future as we further evaluate our real estate needs. For additional information, see Note 7 of the Notes
to Consolidated Financial Statements included in Item 1 of this Quarterly Report on Form 10-Q.
•

In January 2023, we completed an assessment of the useful lives of our servers and network equipment,
resulting in a change in the estimated useful life of our servers and certain network equipment to six years.
The effect of this change was a reduction in depreciation expense of $966 million and $2.0 billion for thethree and six months ended June 30, 2023, respectively, recognized primarily in cost of revenues and R&D
expenses. For additional information, see Note 1 of the Notes to Consolidated Financial Statements
included in Item 1 of this Quarterly Report on Form 10-Q.

•

Repurchases of Class A and Class C shares were $15.1 billion for the three months ended June 30, 2023.
See Note 10 of the Notes to Consolidated Financial Statements included in Item 1 of this Quarterly Reporton Form 10-Q for additional information.

•

Operating cash flow was $28.7 billion for the three months ended June 30, 2023, and was affected by the2023 IRS payment deferral relief made available to tax payers headquartered in designated counties in
California.

•

Capital expenditures, which primarily reflected investments in technical infrastructure, were $6.9 billion for
the three months ended June 30, 2023.

•

As of June 30, 2023, we had 181,798 employees. The substantial majority of the employees affected by the
reduction of our workforce are no longer included in our headcount as of June 30, 2023. We expect most of
the remaining employees affected will no longer be reflected in our headcount by the end of 2023, subject
to local law and consultation requirements.

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Financial Results
Revenues
The following table presents revenues by type (in millions):Three Months Ended

Six Months Ended

June 30,
2022

Google Search & other
YouTube ads
Google Network
Google advertising
Google other$

Google Services total
Google Cloud
Other Bets
Hedging gains (losses)
Total revenues$

40,6897,340
8,259
56,288
6,553
62,841
6,276
193
375
69,685June 30,
2023

$

$

2022

42,6287,665
7,850
58,1438,142
66,2858,031
285
374,604$$2023

80,307
14,20916,433110,949
13,364
124,313
12,097633
653
137,696$$

82,987
14,35815,346112,691
15,555
128,246
15,485573
87
144,391

Google Services
Google advertising revenues
Google Search & other
Google Search & other revenues increased $1.9 billion and $2.7 billion from the three and six months ended
June 30, 2022 to the three and six months ended June 30, 2023, respectively. The overall growth was driven byinterrelated factors including increases in search queries resulting from growth in user adoption and usage on
mobile devices; growth in advertiser spending; and improvements we have made in ad formats and delivery.
Additionally, growth was adversely affected by changes in foreign currency exchange rates for the six months ended
June 30, 2023 and, to a lesser extent, for the three months ended June 30, 2023.
YouTube ads
YouTube ads revenues increased $325 million and $149 million from the three and six months ended June 30,
2022 to the three and six months ended June 30, 2023, respectively. The growth was driven by our brandadvertising products followed by our direct response advertising products, both of which benefited from increased
spending by our advertisers. Additionally, growth was adversely affected by changes in foreign currency exchange
rates for the six months ended June 30, 2023 and, to a lesser extent, for the three months ended June 30, 2023.
Google Network
Google Network revenues decreased $409 million and $1.1 billion from the three and six months ended June30, 2022 to the three and six months ended June 30, 2023, respectively, primarily driven by a decrease in Google
Ad Manager and AdSense revenues. Additionally, Google Network revenues were adversely affected by changes inforeign currency exchange rates for the six months ended June 30, 2023 and, to a lesser extent, for the threemonths ended June 30, 2023.
Monetization Metrics
Paid clicks and cost-per-click
The following table presents year-over-year changes in paid clicks and cost-per-click (expressed as apercentage):

Paid clicks change
Cost-per-click change

Three Months
Ended June 30,

Six Months
Ended June 30,

2023

2023

8%
(3)%

38

8%
(5)%

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Paid clicks increased from the three and six months ended June 30, 2022 to the three and six months ended
June 30, 2023 driven by a number of interrelated factors, including an increase in search queries resulting fromgrowth in user adoption and usage on mobile devices; growth in advertiser spending; and ongoing product andpolicy changes.
Cost-per-click decreased from the three and six months ended June 30, 2022 to the three and six months
ended June 30, 2023 driven by a number of interrelated factors including changes in device mix, geographic mix,
advertiser spending, ongoing product and policy changes, and property mix. Additionally, cost-per-click wasadversely affected by changes in foreign currency exchange rates for the six months ended June 30, 2023 and, to alesser extent, for the three months ended June 30, 2023.
Impressions and cost-per-impression
The following table presents year-over-year changes in impressions and cost-per-impression (expressed as apercentage):

Impressions change
Cost-per-impression change

Three Months
Ended June 30,

Six Months
Ended June 30,

2023

2023

0%
(5)%

(2)%
(5)%

Impressions were relatively unchanged from the three months ended June 30, 2022 to the three months ended
June 30, 2023, as an increase in AdMob was largely offset by decreases in AdSense and Google Ad Manager. The
decrease in cost-per-impression from the three months ended June 30, 2022 to the three months ended June 30,2023 was driven by a number of interrelated factors including ongoing product and policy changes, changes indevice mix, geographic mix, product mix, and property mix, as well as the adverse effect of changes in foreign
currency exchange rates.
Impressions decreased from the six months ended June 30, 2022 to the six months ended June 30, 2023
driven by decreases in Google Ad Manager and AdSense, partially offset by an increase in AdMob. The decrease incost-per-impression from the six months ended June 30, 2022 to the six months ended June 30, 2023 was driven
by a number of interrelated factors including ongoing product and policy changes, changes in device mix,
geographic mix, product mix, and property mix, as well as the adverse effect of changes in foreign currency
exchange rates.
Google other revenues
Google other revenues increased $1.6 billion and $2.2 billion from the three and six months ended June 30,
2022 to the three and six months ended June 30, 2023 primarily driven by growth in YouTube non-advertising,largely due to an increase in paid subscribers, and growth in hardware, due to increased sales of Pixel devices, inlarge part due to product launch timing. Additionally, growth was adversely affected by changes in foreign currency
exchange rates for the six months ended June 30, 2023 and, to a lesser extent, for the three months ended June30, 2023.
Google Cloud
Google Cloud revenues increased $1.8 billion and $3.4 billion from the three and six months ended June 30,
2022 to the three and six months ended June 30, 2023, respectively. Growth was primarily driven by Google Cloud
Platform followed by Google Workspace offerings. Google Cloud's infrastructure and platform services were thelargest drivers of growth in Google Cloud Platform.

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Revenues by Geography
The following table presents revenues by geography as a percentage of revenues, determined based on theaddresses of our customers:
Three Months Ended

Six Months Ended

June 30,
2022

United States
EMEA
APAC
Other Americas
Hedging gains (losses)

47 %
29 %
17 %
6%
1%

June 30,
2023

47 %
30 %
17 %
6%
0%

2022

47 %
30 %
17 %
6%
0%

2023

47 %
30 %
17 %
6%
0%

For further details on revenues by geography, see Note 2 of the Notes to Consolidated Financial Statements
included in Item 1 of this Quarterly Report on Form 10-Q.
Use of Non-GAAP Constant Currency Information
International revenues, which represent a significant portion of our revenues, are generally transacted in
multiple currencies and therefore are affected by fluctuations in foreign currency exchange rates.
The effect of currency exchange rates on our business is an important factor in understanding period-to-period
comparisons. We use non-GAAP constant currency revenues ("constant currency revenues") and non-GAAP
percentage change in constant currency revenues ("percentage change in constant currency revenues") for
financial and operational decision-making and as a means to evaluate period-to-period comparisons. We believe
the presentation of results on a constant currency basis in addition to GAAP results helps improve the ability tounderstand our performance, because it excludes the effects of foreign currency volatility that are not indicative of
our core operating results.
Constant currency information compares results between periods as if exchange rates had remained constantperiod over period. We define constant currency revenues as revenues excluding the effect of foreign currency
exchange rate movements ("FX Effect") as well as hedging activities, which are recognized at the consolidated
level. We use constant currency revenues to determine the constant currency revenue percentage change on a
year-on-year basis. Constant currency revenues are calculated by translating current period revenues using prioryear comparable period exchange rates, as well as excluding any hedging effects realized in the current period.
Constant currency revenue percentage change is calculated by determining the change in current period
revenues over prior year comparable period revenues where current period foreign currency revenues aretranslated using prior year comparable period exchange rates and hedging effects are excluded from revenues ofboth periods.
These results should be considered in addition to, not as a substitute for, results reported in accordance with
GAAP. Results on a constant currency basis, as we present them, may not be comparable to similarly titledmeasures used by other companies and are not a measure of performance presented in accordance with GAAP.

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The following table presents the foreign currency exchange effect on international revenues and total revenues(in millions, except percentages):Three Months Ended June 30, 2023
% Change from Prior Period
Three Months Ended
June 30,
2022
United States$

32,727Less FX
Effect2023$

35,073$0Constant
Currency
Revenues$

Less
Hedging
EffectAs
Reported

Less FX
EffectConstant
Currency
Revenues

35,073

7%

0%

7%

EMEA

20,53322,289(275)

22,564

9%

(1)%

10 %

APAC

11,71012,728(565)

13,293

9%

(5)%

14 %

Other Americas

4,340

4,511

(306)

4,817

4%

(7)%

11 %

Revenues, excluding hedging
effect69,31074,601(1,146)75,747

8%

(1)%

9%

75,747

7%

(1)%

9%

Hedging gains (losses)
Total revenues(1)
(1)

375
$

69,685

3$

74,604$(1)%

Total constant currency revenues of $75.7 billion for the three months ended June 30, 2023 increased $6.4 billion
compared to $69.3 billion in revenues, excluding hedging effect, for the three months ended June 30, 2022.

EMEA revenue growth was unfavorably affected by changes in foreign currency exchange rates, primarily due
to the U.S. dollar strengthening relative to the British pound.
APAC revenue growth was unfavorably affected by changes in foreign currency exchange rates, primarily due
to the U.S. dollar strengthening relative to the Japanese yen.
Other Americas revenue growth was unfavorably affected by changes in foreign currency exchange rates,
primarily due to the U.S. dollar strengthening relative to the Argentine peso.
Six Months Ended June 30, 2023
% Change from Prior Period
Six Months Ended June30,
2022
United States

$

2023

5%

0%

5%

44,815

6%

(4)%

10 %

APAC

23,551

24,409(1,399)25,808

4%

(6)%

10 %

Other Americas

8,182

8,591

(473)

9,064

5%

(6)%

11 %

137,043

144,304(3,320)147,624

5%

(3)%

8%

653

87
$ 147,624

5%

(3)%

8%

137,696$

144,391$

Constant
Currency
Revenues

67,937$0Less FX
Effect(1,448)

(1)

$

Less
Hedging
Effect43,367

Total revenues(1)67,937

As
Reported

40,850Hedging gains (losses)$

Constant
Currency
Revenues

EMEA

Revenues, excluding hedging
effect64,460Less FX
Effect0%Total constant currency revenues of $147.6 billion for the six months ended June 30, 2023 increased $10.6 billion
compared to $137.0 billion in revenues, excluding hedging effect, for the six months ended June 30, 2022.

EMEA revenue growth was unfavorably affected by changes in foreign currency exchange rates, primarily due
to the U.S. dollar strengthening relative to the British pound and the Euro.
APAC revenue growth was unfavorably affected by changes in foreign currency exchange rates, primarily due
to the U.S. dollar strengthening relative to the Japanese yen.
Other Americas revenue growth was unfavorably affected by changes in foreign currency exchange rates,
primarily due to the U.S. dollar strengthening relative to the Argentine peso.

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Costs and Expenses
Cost of Revenues
The following table presents cost of revenues, including TAC (in millions, except percentages):Three Months Ended

Six Months Ended

June 30,
2022

TAC
Other cost of revenues
Total cost of revenues
Total cost of revenues as a percentage of revenues

June 30,
2023

2022

2023

$ 12,214$ 12,537$ 24,204$ 24,258
17,89019,37935,49938,270$ 30,104$ 31,916$ 59,703$ 62,528
43 %
43 %
43 %
43 %

Cost of revenues increased $1.8 billion from the three months ended June 30, 2022 to the three months ended
June 30, 2023 due to an increase in other cost of revenues and TAC of $1.5 billion and $323 million, respectively.
Cost of revenues increased $2.8 billion from the six months ended June 30, 2022 to the six months ended June 30,
2023, primarily due to an increase in other cost of revenues of $2.8 billion.
The increase in TAC from the three months ended June 30, 2022 to the three months ended June 30, 2023
was largely due to an increase in TAC paid to distribution partners, primarily driven by growth in revenues subject toTAC. TAC was relatively unchanged from the six months ended June 30, 2022 to the six months ended June 30,
2023. The TAC rate decreased from 21.7% to 21.6% from the three months ended June 30, 2022 to the threemonths ended June 30, 2023 and decreased from 21.8% to 21.5% from the six months ended June 30, 2022 to thesix months ended June 30, 2023 primarily due to a revenue mix shift from Google Network properties to Google
Search & other properties. The TAC rate on Google Search & other revenues and the TAC rate on Google Network
revenues were both substantially consistent from the three and six months ended June 30, 2022 to the three and six
months ended June 30, 2023.
The increase in other cost of revenues from the three months ended June 30, 2022 to the three months ended
June 30, 2023 was primarily due to increases in content acquisition costs, primarily for YouTube, and hardware
costs. An overall increase in data center and other operations costs was partially offset by a reduction in
depreciation expense due to the change in the estimated useful lives of our servers and certain network equipment.
The increase in other cost of revenues from the six months ended June 30, 2022 to the six months ended June30, 2023 was primarily due to increases in content acquisition costs, primarily for YouTube, and data center andother operations costs. The overall increase in data center and other operations costs includes $700 million of
charges related to employee severance associated with the reduction of our workforce and our office space
optimization efforts, partially offset by a reduction in depreciation expense due to the change in the estimated useful
lives of our servers and certain network equipment.
Research and Development
The following table presents R&D expenses (in millions, except percentages):Three Months Ended

Six Months Ended

June 30,

Research and development expenses$
Research and development expenses as a percentage ofrevenues

June 30,

2022

2023

2022

2023

9,841

$ 10,588$ 18,960$ 22,056

14 %

14 %

14 %

15 %

R&D expenses increased $747 million from the three months ended June 30, 2022 to the three months ended
June 30, 2023 primarily driven by an increase in compensation expenses of $356 million and an increase indepreciation of $168 million. The $356 million increase in compensation expenses was largely the result of a 6%
increase in average headcount, after adjusting for roles affected by the reduction in workforce, partially offset by areduction in valuation-based compensation liabilities related to certain Other Bets. The $168 million increase indepreciation includes the benefit of the change in the estimated useful lives of our servers and network equipment.
R&D expenses increased $3.1 billion from the six months ended June 30, 2022 to the six months ended June30, 2023 primarily driven by an increase in compensation expenses of $2.0 billion and an increase in depreciation of$294 million. The $2.0 billion increase in compensation expenses was largely the result of a 10% increase inaverage headcount, after adjusting for roles affected by the reduction in workforce, and $832 million in employee
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severance charges associated with the reduction of our workforce. The $294 million increase in depreciation
includes the benefit of the change in the estimated useful lives of our servers and network equipment.
Sales and Marketing
The following table presents sales and marketing expenses (in millions, except percentages):Three Months Ended

Six Months Ended

June 30,
2022

Sales and marketing expenses
Sales and marketing expenses as a percentage ofrevenues

$

6,630

$

June 30,
2023

2022

2023

6,781

$ 12,455$ 13,314

10 %

9%

9%

9%

Sales and marketing expenses increased $151 million from the three months ended June 30, 2022 to the threemonths ended June 30, 2023 primarily driven by an increase in compensation expenses of $320 million, largely due
to a combination of factors, none of which were individually significant.
Sales and marketing expenses increased $859 million from the six months ended June 30, 2022 to the six
months ended June 30, 2023 primarily driven by an increase in compensation expenses of $1.1 billion, largely due
to $444 million in employee severance charges associated with the reduction in our workforce and a 5% increase inaverage headcount, after adjusting for roles affected by the reduction in workforce.
General and Administrative
The following table presents general and administrative expenses (in millions, except percentages):Three Months Ended

Six Months Ended

June 30,

General and administrative expenses
General and administrative expenses as a percentage ofrevenues

June 30,

2022

2023

$ 3,657$ 3,481

5%

2022

$

2023

7,031

5%

$

7,240

5%

5%

General and administrative expenses decreased $176 million from the three months ended June 30, 2022 to
the three months ended June 30, 2023, due to a combination of factors, none of which were individually significant.
General and administrative expenses increased $209 million from the six months ended June 30, 2022 to thesix months ended June 30, 2023, primarily driven by an increase in compensation expenses of $319 million, largely
due to $259 million in employee severance charges associated with the reduction in our workforce.
Segment Profitability
The following table presents segment operating income (loss) (in millions).
Three Months Ended

Six Months Ended

June 30,

Operating income (loss):
Google Services
Google Cloud
Other Bets
Corporate costs, unallocated(1)Total income from operations
(1)

$

$

June 30,

2022

2023

2022

2023

21,621 $(590)(1,339)(239)
19,453 $23,454 $395(813)(1,198)21,838 $43,594 $(1,296)(2,174)(577)
39,547 $45,191586(2,038)(4,486)39,253

In addition to the Alphabet-level costs included in unallocated corporate costs, hedging gains (losses) related to revenue
were $375 million and $3 million for the three months ended June 30, 2022 and 2023, respectively, and $653 million and$87 million for the six months ended June 30, 2022 and 2023, respectively. For the three and six months ended June 30,
2023, unallocated corporate costs include charges related to the reductions in our workforce and office space totaling $70
million and $2.6 billion, respectively.

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Google Services
Google Services operating income increased $1.8 billion from the three months ended June 30, 2022 to thethree months ended June 30, 2023 and increased $1.6 billion from the six months ended June 30, 2022 to the six
months ended June 30, 2023. The increase in operating income was primarily driven by an increase in revenues,
partially offset by an increase in compensation expenses and content acquisition costs. Additionally, operating
income benefited from a reduction in costs driven by the change in the estimated useful lives of our servers andcertain network equipment.
Google Cloud
Google Cloud operating income of $395 million for the three months ended June 30, 2023 compared to an
operating loss of $590 million for the three months ended June 30, 2022 represents an increase of $985 million.
Operating income of $586 million for the six months ended June 30, 2023 compared to an operating loss of$1.3 billion for the six months ended June 30, 2022 represents an increase of $1.9 billion. The increase in operating
income was primarily driven by revenue growth, partially offset by an increase in compensation expenses.
Additionally, operating income benefited from a reduction in costs driven by the change in the estimated useful livesof our servers and certain network equipment.
Other Bets
Other Bets operating loss decreased $526 million from the three months ended June 30, 2022 to the threemonths ended June 30, 2023 and decreased $136 million from the six months ended June 30, 2022 to the six
months ended June 30, 2023, primarily driven by a reduction in valuation-based compensation liabilities related tocertain Other Bets.
Other Income (Expense), Net
The following table presents other income (expense), net (in millions):Three Months Ended

Six Months Ended

June 30,
2022

Other income (expense), net

$

(439)

June 30,
2023

$

2022

65

$

(1,599)

2023

$

855

Other income (expense), net, increased $504 million from the three months ended June 30, 2022 to the threemonths ended June 30, 2023 primarily due to gains and losses on equity and debt securities and changes ininterest income. In the three months ended June 30, 2023, we recognized $892 million of interest income and$398 million of net unrealized gains on marketable equity securities. This was partially offset by $689 million of net
unrealized losses on non-marketable equity securities and $304 million of net losses on debt securities. In the threemonths ended June 30, 2022, we recognized $1.2 billion of net unrealized losses on marketable equity securities
and $790 million of net losses on debt securities. This was partially offset by $911 million of net unrealized gains on
non-marketable equity securities and $486 million of interest income.
Other income (expense), net, increased $2.5 billion from the six months ended June 30, 2022 to the six
months ended June 30, 2023 primarily due to unrealized gains and losses on equity securities and changes ininterest income. In the six months ended June 30, 2023, we recognized $1.7 billion of interest income. This waspartially offset by $597 million and $478 million of net losses on debt securities and foreign currency exchange,
respectively, and $468 million of net unrealized losses on non-marketable equity securities. In the six months ended
June 30, 2022, we recognized $2.5 billion of net unrealized losses on marketable equity securities, and $1.2 billionof net losses on debt securities. This was partially offset by $1.4 billion of net unrealized gains on non-marketable
equity securities.
See Note 6 of the Notes to Consolidated Financial Statements included in Item 1 of this Quarterly Report on
Form 10-Q for further information.

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Provision for Income Taxes
The following table presents provision for income taxes (in millions, except effective tax rate):
Three Months Ended

Six Months Ended

June 30,
2022

Income before provision for income taxes
Provision for income taxes
Effective tax rate

June 30,
2023

2022

2023

$ 19,014$ 21,903$ 37,948$ 40,108$ 3,012$ 3,535$ 5,510$ 6,68915.8 %
16.1 %
14.5 %
16.7 %The effective tax rate increased from the three months ended June 30, 2022 to the three months ended June30, 2023, primarily driven by changes in certain tax return positions, partially offset by a decrease in the tax rate due
to reduced 2023 tax losses of certain subsidiaries for which there is no tax benefit.
The effective tax rate increased from the six months ended June 30, 2022 to the six months ended June 30,
2023, primarily driven by a decrease in the stock-based compensation-related tax benefit and changes in certain tax
return positions.
On July 21, 2023 the IRS announced in a notice that taxpayers can temporarily apply the regulations in effectprior to 2022 related to U.S. federal foreign tax credits. This relief applies to foreign taxes paid or accrued in our
fiscal years 2022 and 2023. We are currently evaluating the effect on our consolidated financial statements andexpect to recognize any changes in our financial results for the period ending September 30, 2023.
Financial Condition
Cash, Cash Equivalents, and Marketable Securities
As of June 30, 2023, we had $118.3 billion in cash, cash equivalents, and short-term marketable securities.
Cash equivalents and marketable securities are comprised of time deposits, money market funds, highly liquid
government bonds, corporate debt securities, mortgage-backed and asset-backed securities, and marketable equity
securities.
Sources, Uses of Cash and Related Trends
Our principal sources of liquidity are cash, cash equivalents, and marketable securities, as well as the cash
flow that we generate from operations. The primary use of capital continues to be to invest for the long-term growthof the business. We regularly evaluate our cash and capital structure, including the size, pace, and form of capital
return to stockholders.
The following table presents our cash flows (in millions):
Six Months Ended
June 30,2022

Net cash provided by operating activities
Net cash used in investing activities
Net cash used in financing activities

2023

$

44,528$52,175$$(13,238) $(34,031) $(13,746)(34,403)

Cash Provided by Operating Activities
Our largest source of cash provided by operations are advertising revenues generated by Google Search &other properties, Google Network properties, and YouTube properties. Additionally, we generate cash through salesof apps and in-app purchases, and hardware; and licensing and service fees, including fees received for Google
Cloud offerings and subscription-based products.
Our primary uses of cash from operating activities include payments to distribution and Google Network
partners, to employees for compensation, and to content providers. Other uses of cash from operating activities
include payments to suppliers for hardware, to tax authorities for income taxes, and other general corporate
expenditures.
Net cash provided by operating activities increased from the six months ended June 30, 2022 to the six
months ended June 30, 2023 due to the 2023 IRS payment deferral relief made available to taxpayers

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headquartered in designated counties in California, partially offset by increased cash payments for costs andexpenses.
Cash Used in Investing Activities
Cash provided by investing activities consists primarily of maturities and sales of investments in marketable
and non-marketable securities. Cash used in investing activities consists primarily of purchases of marketable andnon-marketable securities, purchases of property and equipment, and payments for acquisitions.
Net cash used in investing activities increased from the six months ended June 30, 2022 to the six months
ended June 30, 2023 as a result of an increase in net purchases of and maturities and sales of marketablesecurities, partially offset by a decrease in purchases of property and equipment.
Cash Used in Financing Activities
Cash provided by financing activities consists primarily of proceeds from issuance of debt and proceeds fromthe sale of interest in consolidated entities. Cash used in financing activities consists primarily of repurchases ofstock, net payments related to stock-based award activities, and repayments of debt.
Net cash used in financing activities increased from the six months ended June 30, 2022 to the six months
ended June 30, 2023 primarily due to an increase in repurchases of stock partially offset by a decrease in net
payments related to stock-based award activities.
Liquidity and Material Cash Requirements
We expect existing cash, cash equivalents, short-term marketable securities, cash flows from operations andfinancing activities to continue to be sufficient to fund our operating activities and cash commitments for investing
and financing activities for at least the next 12 months and thereafter for the foreseeable future.
Capital Expenditures and Leases
We make investments in land and buildings for data centers and offices and information technology assets
through purchases of property and equipment and lease arrangements to provide capacity for the growth of ourservices and products.
Capital Expenditures
Our capital investments in property and equipment consist primarily of the following major categories:•

technical infrastructure, which consists of our investments in servers and network equipment for computing,storage, and networking requirements for ongoing business activities, including AI, (collectively referred toas our information technology assets) and data center land and building construction; and•office facilities, ground-up development projects, and building improvements (also referred to as "fit-outs").

Construction in progress consists primarily of technical infrastructure and office facilities which have not yet
been placed in service. The time frame from date of purchase to placement in service of these assets may extend
from months to years. For example, our data center construction projects are generally multi-year projects withmultiple phases, where we acquire qualified land and buildings, construct buildings, and secure and install
information technology assets.
During the six months ended June 30, 2022 and 2023, we spent $16.6 billion and $13.2 billion on capital
expenditures, respectively. We expect to continue to invest in our technical infrastructure, including servers, network
equipment, and data centers, over the remainder of 2023 and into 2024 to support the growth of our business andour long-term initiatives, in particular in support of AI. Depreciation of our property and equipment commences when
the deployment of such assets are completed and are ready for our intended use. Land is not depreciated. For thesix months ended June 30, 2022 and 2023, our depreciation and impairment expenses on property and equipment
were $7.3 billion and $6.3 billion, respectively.
LeasesFor the six months ended June 30, 2022 and 2023, we recognized total operating lease assets of $2.2 billion
and $1.7 billion, respectively. As of June 30, 2023, the amount of total future lease payments under operatingleases, which had a weighted average remaining lease term of 8.2 years, was $18.2 billion. As of June 30, 2023, wehave entered into leases that have not yet commenced with future lease payments of $2.9 billion, that are not yet
recorded on our Consolidated Balance Sheets. These leases will commence between 2023 and 2027 with noncancelable lease terms of 1 to 34 years. As of June 30, 2023 our actions to optimize our office space did not affectour operating lease obligations.
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For the six months ended June 30, 2022 and 2023, our operating lease expenses (including variable lease
costs) were $1.8 billion and $2.2 billion, respectively. Finance lease costs were not material for the six months
ended June 30, 2022 and 2023.
Financing
We have a short-term debt financing program of up to $10.0 billion through the issuance of commercial paper.
Net proceeds from this program are used for general corporate purposes. As of June 30, 2023, we had nocommercial paper outstanding.
As of June 30, 2023, we had $10.0 billion of revolving credit facilities, $4.0 billion expiring in April 2024 and$6.0 billion expiring in April 2028. The interest rates for all credit facilities are determined based on a formula using
certain market rates, as well as our progress toward the achievement of certain sustainability goals. No amounts
have been borrowed under the credit facilities.
As of June 30, 2023, we had senior unsecured notes outstanding with a total carrying value of $12.9 billion.
See Note 5 of the Notes to Consolidated Financial Statements included in Item 1 of this Quarterly Report on Form
10-Q for further information on our debt.
We primarily utilize contract manufacturers for the assembly of our servers used in our technical infrastructureand hardware products we sell. We have agreements where we may purchase components directly from suppliers
and then supply these components to contract manufacturers for use in the assembly of the servers and hardware
products. Certain of these arrangements result in a portion of the cash received from and paid to the contract
manufacturers to be presented as financing activities in the Consolidated Statements of Cash Flows included in
Item 1 of this Quarterly Report on Form 10-Q.
Share Repurchase Program
During the three and six months ended June 30, 2023, we repurchased and subsequently retired 131 million
and 288 million shares for $15.1 billion and $30.2 billion, respectively. Of the aggregate amount repurchased andsubsequently retired during the three months ended June 30, 2023, 17 million shares were Class A stock for $1.9
billion and 114 million shares were Class C stock for $13.2 billion. Of the aggregate amount repurchased andsubsequently retired during the six months ended June 30, 2023, 37 million shares were Class A stock for $3.9
billion and 251 million shares were Class C stock for $26.3 billion.
In April 2022, the Board of Directors of Alphabet authorized the company to repurchase up to $70.0 billion of its
Class A and Class C shares. The repurchases from the April 2022 authorization were completed during the second
quarter of 2023. In April 2023, the Board of Directors of Alphabet authorized the company to repurchase up to an
additional $70.0 billion of its Class A and Class C shares. As of June 30, 2023, $68.1 billion remains available forClass A and Class C share repurchases.
See Note 10 of the Notes to Consolidated Financial Statements included in Item 1 of this Quarterly Report on
Form 10-Q.
The U.S. Inflation Reduction Act of 2022 was enacted on August 16, 2022 and requires a one percent excise
tax on certain share repurchases in excess of shares issued for employee compensation made after December 31,
2022. We do not expect this provision to have a material effect on our consolidated financial statements.
European Commission Fines
In 2017, 2018 and 2019, the EC announced decisions that certain actions taken by Google infringed European
competition law and imposed fines of €2.4 billion ($2.7 billion as of June 27, 2017), €4.3 billion ($5.1 billion as ofJune 30, 2018), and €1.5 billion ($1.7 billion as of March 20, 2019), respectively. On September 14, 2022, theGeneral Court reduced the 2018 fine from €4.3 billion to €4.1 billion. We subsequently filed an appeal to theEuropean Court of Justice.
While each EC decision is under appeal, we included the fines in accrued expenses and other current liabilities
on our Consolidated Balance Sheets as we provided bank guarantees (in lieu of a cash payment) for the fines. For
further details, see Note 9 of the Notes to Consolidated Financial Statements included in Item 1 of this Quarterly
Report on Form 10-Q.
Taxes
As of June 30, 2023, we had short-term and long-term income taxes payable of $3.6 billion and $2.2 billion
related to a one-time transition tax payable incurred as a result of the U.S. Tax Cuts and Jobs Act ("Tax Act"). As

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permitted by the Tax Act, we will pay the transition tax in annual interest-free installments through 2025. We also
have long-term taxes payable of $6.6 billion primarily related to uncertain tax positions as of June 30, 2023.
As a result of the 2023 IRS payment deferral relief made available to taxpayers headquartered in designatedcounties in California, we are postponing our second and third quarter tax payments until the fourth quarter of 2023.
See Note 6 of the Notes to Consolidated Financial Statements included in Item 1 of this Quarterly Report on Form
10-Q.
Purchase Commitments
As of June 30, 2023, we had material contractual obligations of $42.0 billion, of which $27.9 billion was shortterm. These amounts consist of purchase orders for certain technical infrastructure as well as the non-cancelable
portion or the minimum cancellation fee in certain agreements related to commitments to purchase licenses,
including content licenses, inventory and network capacity. For those agreements with variable terms, we do notestimate the non-cancelable obligation beyond any minimum quantities and/or pricing as of June 30, 2023. In
certain instances, the amount of our contractual obligations may change based on the expected timing of orderfulfillment from our suppliers. For more information related to our content licenses, see Note 9 of the Notes toConsolidated Financial Statements included in Item I of this Quarterly Report on Form 10-Q.
In addition we regularly enter into multi-year, non-cancellable agreements to purchase renewable energy andenergy attributes, such as renewable energy certificates. These agreements do not include a minimum dollar
commitment. The amounts to be paid under these agreements are based on the actual volumes to be generated
and are not readily determinable.
Critical Accounting Estimates
See Part II, Item 7, "Critical Accounting Estimates" in our Annual Report on Form 10-K for the year ended
December 31, 2022.
Available Information
Our website is located at www.abc.xyz, and our investor relations website is located at www.abc.xyz/investor.
Access to our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and
our Proxy Statements, and any amendments to these reports, is available on our investor relations website, free ofcharge, after we file or furnish them with the SEC and they are available on the SEC's website at www.sec.gov.
We webcast via our investor relations website our earnings calls and certain events we participate in or hostwith members of the investment community. Our investor relations website also provides notifications of news orannouncements regarding our financial performance and other items of interest to our investors, including SEC
filings, investor events, press and earnings releases, and blogs. We also share Google news and product updates
on Google’s Keyword blog at https://www.blog.google/, which may be of interest or material to our investors.
Further, corporate governance information, including our certificate of incorporation, bylaws, governance guidelines,
board committee charters, and code of conduct, is also available on our investor relations website under theheading "Governance." The content of our websites are not incorporated by reference into this Quarterly Report on
Form 10-Q or in any other report or document we file with the SEC, and any references to our websites areintended to be inactive textual references only.
ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKFor quantitative and qualitative disclosures about market risk, refer to Part II, Item 7A, Quantitative andQualitative Disclosures About Market Risk, in our Annual Report on Form 10-K for the year ended December 31,
2022.
ITEM 4.

CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our chief executive officer and chief financial officer, evaluated theeffectiveness of our disclosure controls and procedures pursuant to Rule 13a-15 under the Exchange Act, as of theend of the period covered by this Quarterly Report on Form 10-Q.
Based on this evaluation, our chief executive officer and chief financial officer concluded that, as of June 30,
2023, our disclosure controls and procedures are designed at a reasonable assurance level and are effective toprovide reasonable assurance that information we are required to disclose in reports that we file or submit under the
Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s
rules and forms, and that such information is accumulated and communicated to our management, including our48

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chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required
disclosure.
Changes in Internal Control over Financial Reporting
There have been no changes in our internal control over financial reporting that occurred during the quarter
ended June 30, 2023 that have materially affected, or are reasonably likely to materially affect, our internal control
over financial reporting.
Limitations on Effectiveness of Controls and Procedures
In designing and evaluating the disclosure controls and procedures, management recognizes that any controls
and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving
the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that
there are resource constraints and that management is required to apply its judgment in evaluating the benefits ofpossible controls and procedures relative to their costs.

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PART II.

OTHER INFORMATIONITEM 1.

LEGAL PROCEEDINGSFor a description of our material pending legal proceedings, see Note 9 “Commitments and Contingencies Legal Matters” of the Notes to Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Reporton Form 10-Q, which is incorporated herein by reference.
ITEM 1A.

RISK FACTORS

Our operations and financial results are subject to various risks and uncertainties, including those described inPart I, Item 1A, "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2022, which
could adversely affect our business, financial condition, results of operations, cash flows, and the trading price of
our stock.
ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer Purchases of Equity Securities
The following table presents information with respect to Alphabet's repurchases of Class A and Class C stockduring the quarter ended June 30, 2023.

PeriodTotal Number ofClass A Shares
Purchased(in thousands)

Total Number ofClass C Shares
Purchased(in thousands)

6,163
5,490
4,941
16,594

41,151
38,571
34,664
114,386(1)April 1 - 30
May 1 - 31
June 1 - 30
Total

(1)

Average Price
Paid per ClassA Share (2)$$$Average Price
Paid per ClassC Share (2)106.53 $116.89 $123.29 $106.94116.97123.88

Total Number of
SharesPurchased as
Part of Publicly
Announced
Programs(in thousands)(1)

47,31444,061
39,605130,980

Approximate
Dollar Value of
Shares that May
Yet BePurchased
Under theProgram(in millions)$$$

78,05972,94568,070(1)

Repurchases are being executed from time to time, subject to general business and market conditions and otherinvestment opportunities, through open market purchases or privately negotiated transactions, including through Rule10b5-1 plans. The repurchase program does not have an expiration date. See Note 10 in Part I, Item 1 of this Quarterly
Report on Form 10-Q for additional information related to share repurchases.

(2)

Average price paid per share includes costs associated with the repurchases.

ITEM 5.

OTHER INFORMATION

10b5-1 Trading Plans
During the fiscal quarter ended June 30, 2023, the following Section 16 officers adopted, modified or
terminated “Rule 10b5-1 trading arrangements” (as defined in Item 408 of Regulation S-K of the Exchange Act):•

Amie Thuener O’Toole, Vice President, Corporate Controller and Principal Accounting Officer, adopted a
new trading plan on May 31, 2023 (with the first trade under the new plan scheduled for September 5,2023). The trading plan will be effective until September 9, 2024 to sell an aggregate of (i) 2,904 shares ofClass C Capital Stock, plus (ii) 50% of the (net) shares resulting from the vesting of 32,093 additional(gross) Class C Capital Stock during the plan period (net shares are net of tax withholding).

•

Kent Walker, President, Global Affairs, Chief Legal Officer and Secretary, effected a trading plan
modification by terminating a trading plan on May 30, 2023, originally adopted on May 28, 2022, andadopting a new trading plan on May 31, 2023 (with the first trade under the new plan scheduled for
September 5, 2023). The trading plan will be effective until February 27, 2026 to sell 100% of the (net)shares resulting from the vesting of 511,048 (gross) Class C Capital Stock during the plan period (netshares are net of tax withholding)*.

*In accordance with new SEC rules adopted on December 14, 2022, any modification or change to theamount, price, or timing of the purchase or sale of securities constitutes a termination of an existing Rule 10b5-1
trading arrangement and the adoption of a new Rule 10b5-1 trading arrangement.
There were no “non-Rule 10b5-1 trading arrangements” (as defined in Item 408 of Regulation S-K of the
Exchange Act) adopted, modified or terminated during the fiscal quarter ended June 30, 2023 by our directors andSection 16 officers. Each of the Rule 10b5-1 trading arrangements are in accordance with our Policy Against Insider

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Trading and actual sale transactions made pursuant to such trading arrangements will be disclosed publicly in
Section 16 filings with the SEC in accordance with applicable securities laws, rules and regulations.

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ITEM 6.

Alphabet Inc.

EXHIBITS

Exhibit
Number

Incorporated by reference herein
Form
Date

Description

10.01

⬥

10.02

⬥ * Alphabet Inc. Amended and Restated 2021 Stock Plan - Formof Alphabet 2023 Non-CEO Performance Stock Unit
Agreement

10.03
31.01

⬥ * Alphabet Inc. Amended and Restated 2021 Stock Plan - Formof Alphabet Restricted Stock Unit Agreement*
Certification of Chief Executive Officer pursuant to Exchange
Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002

31.02

*

Certification of Chief Financial Officer pursuant to Exchange
Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002

32.01

‡

Certifications of Chief Executive Officer and Chief Financial
Officer pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS*

Inline XBRL Instance Document - the instance document
does not appear in the Interactive Data File because its XBRL
tags are embedded within the Inline XBRL document.

101.SCH *101.CAL *101.DEF *101.LAB *101.PRE *104

Alphabet Inc. Amended and Restated 2021 Stock Plan

Current Report
June 8, 2023
on Form 8-K (FileNo. 001-37580)

Inline XBRL Taxonomy Extension Schema Document
Inline XBRL Taxonomy Extension Calculation Linkbase
Document
Inline XBRL Taxonomy Extension Definition Linkbase
Document
Inline XBRL Taxonomy Extension Label Linkbase Document
Inline XBRL Taxonomy Extension Presentation Linkbase
Document
Cover Page Interactive Data File (formatted as Inline XBRLand contained in Exhibit 101)__________________________⬥*‡

Indicates management compensatory plan, contract, or arrangement.
Filed herewith.
Furnished herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused thisreport to be signed on its behalf by the undersigned thereunto duly authorized.

ALPHABET INC.
July 25, 2023

By: /s/

RUTH M. PORAT

Ruth M. Porat
Senior Vice President and Chief Financial Officer

ALPHABET INC.
July 25, 2023

By: /s/AMIE THUENER O'TOOLE

Amie Thuener O'Toole
Vice President, Corporate Controller and Principal Accounting
Officer

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