How Much Is Google Worth?
Google’s ubiquity seems to qualify it as less of “a search engine” and more so “the search engine.” Its cultural imprint runs so deep that “Google” has become a verb, and many people use it as their default browser page. With a share of the global search engine market that comes out to over 91%, according to Statcounter, the fact that Google is an important part of the daily lives of most people can’t be understated. GOBankingRates googled some figures on Alphabet, Google’s parent company, to see what this importance means for investors.
Alphabet announced its second-quarter results for 2021 on July 27, crushing Wall Street expectations. The company generated revenues of about $61.9 billion, based on YouTube’s strength and robust advertising growth.
|Google: Company Snapshot|
|Headquarters||Mountain View, California|
|Founders||Sergey Brin, Larry Page|
How Much Is Google Worth Now?
The price of GOOG, Alphabet’s Class C shares, is $2,760.04 as of Aug. 9, giving Google’s parent company a current market capitalization of $1.831 trillion. In addition to its Class C shares, there are also shares of GOOGL, Alphabet’s Class A common stock. Both types of shares are currently trading at relatively similar prices.
|What Is Google Worth?|
|Alphabet (GOOG) Share Price, 52-Week Range||$1,406.55 – $2,800.22|
|Second Quarter 2021 Revenue||$61.880 billion|
|Shareholders’ Equity||$237.565 billion|
What Is Market Capitalization?
Market capitalization is one of several metrics investors use to gauge how much a company is worth. The market cap is the value of all of the company’s stock combined, giving you a sense of what value investors are placing on the company based on the price it is trading at. The figure can change as much as the share price does since it’s calculated by multiplying the number of outstanding shares by the current trading price.
Although Alphabet shares were recently at a 52-week high of $2,800.22, the company is susceptible to market volatility, perhaps as a result of competing with tech giants like Apple or Amazon. Alphabet’s share price was $1,406.55 at its 52-week low. Swings in share price have, in turn, caused its market cap to vary widely over the same period.
What Is Google’s Net Worth?
Google’s net worth can be calculated by subtracting the company’s liabilities from its assets. Shareholders’ equity, which likewise equals total assets minus total liabilities, is essentially a company’s net worth. Alphabet’s total shareholders’ equity as of the quarter ending June 30 was $237.565 billion.
CEO Sundar Pichai said, “Our long-term investments in AI and Google Cloud are helping us drive significant improvements in everyone’s digital experience,” according to Alphabet’s July 27 press release. Strong income across Alphabet’s divisions, including Google Search and advertising, YouTube, and Google Cloud services, contributed to Google’s net worth.
Google was founded in 1998 by Larry Page and Sergey Brin. The two met at Stanford in 1995 and collaborated on a search engine called Backrub. Google is a play on the word “googol,” which is a one followed by 100 zeros. The name was a great summary of Page and Brin’s mission “to organize the world’s information and make it universally accessible and useful.”
Forbes named Page and Brin among the top 10 on its list of the world’s richest billionaires, with net worths of $117.2 billion and $113.4 billion, respectively, as of Aug. 9.
Key Product Lines Contributing to Revenue
Alphabet’s second-quarter earnings report highlighted several categories that contributed to its astounding success. The following product lines are partly responsible for its revenue:
- Google Services: Includes Google Search, Google Maps and the Google Play app store
- YouTube ads: Alphabet’s fastest-growing ad source; up 83% from last year for over $7 billion in revenue, according to CNBC
- Google advertising: Google ad revenue was up 69% from last year, CNBC reported
Alphabet’s Top 10 Shareholders
GOOGL has one of the highest levels of institutional ownership at 79.08%. The top 10 shareholders of Alphabet’s Class A stock are:
|Shareholder||Percentage of Shares|
|1||The Vanguard Group Inc.||7.14%|
|2||BlackRock Fund Advisors||4.41%|
|3||Fidelity Management & Research Co. LCC||4.04%|
|4||SSgA Funds Management Inc.||3.69%|
|5||T. Rowe Price Associates Inc.||2.44%|
|6||Wellington Management Co. LLP||1.88%|
|7||Geode Capital Management LLC||1.64%|
|8||Capital Research & Management Co.||1.33%|
|9||Northern Trust Investments Inc.||1.24%|
|10||Massachusetts Financial Services Co.||0.97%|
Is Google Worth the Money?
Alphabet has outperformed other FAANG stocks this year, such as Facebook, Netflix and Amazon. Based on five analysts, Alphabet is a “buy” to “strong buy,” with an average price target of $2,625, according to Yahoo Finance. However, Alphabet’s current share price of $2,760.04 exceeds price targets, leaving investors to question how much further room for growth there may be. Based on historical share appreciation, impressive revenue news and future potential from investments such as YouTube and AI, Alphabet may be worth the money as a long-term investment.
Sean Dennison contributed to the reporting for this article.
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Data is accurate as of Aug. 9, 2021, unless otherwise noted, and subject to change.
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- Alphabet. 2021. "Alphabet Announces Second Quarter 2021 Results."
- CNBC. 2021. "Google advertising revenue rises 69% from last year."
- CNBC. 2021. "How Google’s $150 billion advertising business works."
- MarketWatch. 2020. "Google becomes third U.S. tech company worth $1 trillion."
- Statcounter. "Search Engine Market Share Worldwide."
- Forbes. 2021. "Forbes World’s Billionaires List."