Google, which is a subsidiary of holding company Alphabet, Inc. GOOGL GOOG, has now become one of the most influential tech companies on Wall Street. As is the case with any of the startups, it had a humble beginning at a Stanford University dorm room. As the company commemorates the 26th anniversary of its incorporation, here’s a brief look into its history, evolution and future:
The Birth: Two Stanford University students Larry Page and Sergey Brin got together in 1995 to build a search engine that used links to determine the importance of individual pages on the World Wide Web and named it Backrub. Their mission was to organize information so that it is universally accessible and useful.
The first venture capital investment came from Sun Microsystems co-founder Andy Bechtolsheim and he plowed in $1 million seed money in the company in August 1998. Following the funding, Google was incorporated on Sept. 4, 1998, which is officially its founding year. The company initially operated out of former YouTube CEO Susan Wojcicki’s Menlo Park garage.
As the company grew, the office was shifted to “Googleplex,” which currently serves as its headquarters.
See Also: Everything You Need to Know About Google Stock
The Evolution: Google Adwords, an online ad platform that helps businesses reach customers by displaying ads to users who search for relevant keywords, was set up in October 2000. This platform has now been renamed as Google Ads. The company had a flurry of launches in the subsequent years, with Google Image Search rolled out in July 2001, Gmail in April 2004 and Google Maps in February 2005.
A year later in November 2006, Google bought YouTube, an online video-sharing platform, for $1.65 billion, and it added digital advertising platform DoubleClick to its business in April 2007. The company launched Street View, a technology featured in Google Maps and Google Earth.
In September 2008, Google launched its proprietary browser Chrome and the Android operating system, which has become a key mobile operating system. Android had a 70.7% share of the mobile OS market, with its closest rival Apple’s iOS having a 28.5% market share. The company followed up with the launch of the Nexus One phone in January 2010.
The company restructured its business in August 2015, with Alphabet as the holding company and Google as its flagship subsidiary. The other subsidiaries include venture capital arm CapitalG, Google Fiber, life sciences research business Verily and Waymo autonomous driving company, among others.
The Google Pixel phone was launched in October 2016.
Google also has a thriving Cloud computing platform, which is the third biggest public cloud business after Microsoft and Amazon’s Azure.
Following the artificial intelligence craze, Google took a plunge into the arena and launched its Bard chatbot in March 2023.
The Google IPO: The company offered its shares to the public through an initial public offering of 22.5 million shares and it made its stock exchange debut on Aug. 19, 2004.
The company initiated its first-ever dividend earlier this year. Most recently, it announced a cash dividend of 20 cents per share on each of the company's Class A, Class B, and Class C shares. It has split its shares thrice in the past.
Returns From Google: A $1,000 invested in Google in its IPO would have fetched roughly 399 shares (based on the split-adjusted price of $2.51 at the close of the debut session). The same shares would now be worth $62,787, a return of 6,179%. This compares favorably to the little over 400% gain recorded by the S&P 500 – a broader gauge, during the same period.
Source: Benzinga Pro data
The Future: Alphabet, helmed by Sundar Pichai, is now counted among the mega-cap techs and is part of an elite group called the Magnificent Seven. It boasts of a market capitalization of $1.944 trillion, giving it the distinction of being the fourth most valued global corporation.
The company is now bursting at its seams, with many businesses under its fold. Its search dominance has invited the attention of the Department of Justice in the U.S. and regulators elsewhere. They have been calling for a breakup of the company.
For the fiscal year 2023 that ended Dec. 31, 2023, the company raked in revenue of $307.39 billion, with the bulk of it coming from its Ad business.
In premarket trading on Wednesday, the Class A shares of Alphabet trading under the ticker symbol GOOGL were down 0.31% at $156.88, according to Benzinga Pro data.
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