CNBC: Sundar Pichai, CEO of Alphabet and Google interviewed by Deirdre Bosa.
“We definitely see the uncertainty ahead of us, like everyone else,” Pichai told CNBC’s Deirdre Bosa in an interview Wednesday at Google’s annual I / O conference in Mountain View, California. “The good thing is we’ve been around as a company for a while. [We] they have worked in past moments like this, whether it’s in 2008 or the early days of the pandemic, and we have a long-term vision. “
He also said he thought the economy would “take some time to get over” the current high rate of inflation.
“What gives uncertainty is that there are so many different factors, whether it is supply chain problems or rising energy prices,” he said.
“I think people are seeing relief in certain areas,” he suggested, pointing to travel as an example. “But then there are other new areas that are showing problems, perhaps due to supply chain constraints … Energy has been a problem, for example. In some cases, rents and food prices have increased.”
the Nasdaq it is headed for the strongest quarterly decline since late 2008, when the economy was grappling with the housing crisis. consumer prices jumped 8.3% in April, the Bureau of Labor Statistics said Wednesday, more than expected and close to a 40-year high of 8.5%.
Google parent actions alphabet they have fallen by about 22% this year, plummeting hand in hand the rest of the technology sector as fears of inflation and higher interest rates push investors into assets considered safer during a potential recession.
Alphabet earnings at the end of April it did not live up to analysts’ estimates, largely due to a serious lack of YouTube, which was hammered along with other digital advertising companies in the first quarter. Executives indicated weaker YouTube ad spend in Europe afterwards Russia invaded Ukraine in February.
“Of course, when you are serving [ads] across the economy … many of the macroeconomic factors such as GDP growth end up affecting advertiser spending as well, ”Pichai said.
Pichai said that economic history is not just about doom and gloom. Based on comments last month from Philipp Schindler, Alphabet’s chief business officer, he noted that people are on the move again, an important indication for Google’s primary ad unit.
“We definitely see the trip resume,” Pichai said. “There are signs that people are clearly moving after the pandemic, so there is a return to normal. But what creates uncertainty is that there are so many different factors, whether it be supply chain problems or rising energy prices. And so trying to add it all together is where the uncertainty lies. “
Pichai pointed to the company’s technology investments as a vital way to keep its business strong during times of weakness and did not indicate that the company has plans to slow hiring or retire in particular areas.
“We want to be resilient at times like this. We are very excited about future opportunities. And so we are investing. We continue to hire, bringing in great talent. There are areas where we find ourselves where we are seeing a transformation, such as the cloud and transformation. to digital [we] continue to invest “.
Alphabet increased its R&D spending 22% in the first quarter from a year earlier to $ 9.1 billion, despite economic uncertainty and market volatility.
He also mentioned the company’s diversification into many business lines as a source of strength.
“We invest in core technologies and operate in many areas. So, in some ways, we are diversified. Obviously, we have important products like search and YouTube. We have computing products involving Android, Play and our hardware devices. And the cloud is a great area of opportunity for us too. So I think we are exposed to many, many industries. And we do it globally as a company. And I think that allows us to have a long-term vision and reflect on these phases. “
Sundar Pichai, CEO of Alphabet and Google interviewed by CNBC’s Deirdre Bosa.
Google kicked off its conference on Wednesday later announcing new smartphones and tease augmented reality glasses that use artificial intelligence to translate spoken words into text on the screen. Facebook parent A half Other Microsoft they are also working on AR devices.
Google has to spend to keep up with competitors in a rapidly changing market, particularly with the emergence of the TikTok short video service, which is immensely popular with younger consumers. Google’s response to TikTok, YouTube Shorts, is growing rapidly, attracting over 30 billion daily views in late April, up from 15 billion in January.
“We have to answer what users ask,” Pichai said. “We are trying to offer them the best experience and therefore we feel challenged to do better.”
“We always have to be nimble and adapt, and that’s how it feels every Monday when I come to work,” he said.
“I grew up in a great democracy and the importance of free speech and giving people a voice I think is really fundamental,” said Pichai, who was born in India. “Research represents what’s on the web today. We only eliminate things that are against the law.”
He added: “In a product like YouTube, where we recommend and where we can amplify content, we have community guidelines. So we have clearly defined rules. And we take action. And that’s exactly what allows us to maximize free speech, [to] helps keep the platform safe for everyone involved. “
He also talked a little about the company’s approach to content moderation. “I think it’s important to give people a sense of transparency. And there are many ways to do this. For example, we publish our community guidelines or, in the case of research, how our evaluators rate the quality of research. , we publish it publicly. ” He added: “I think it’s important to do it in a way that spammers and others who are trying to get around your products aren’t able to do the same.”
As for Musk’s plans for Twitter, he said, “I’m an avid Twitter user. I think it’s an extraordinarily important product to the world. I’ve made a lot of it. And I think there’s value in investing in it for the long haul. term … I think it is important because it plays an important role in democratic society … I would like to see the product continue to improve. “