NEW YORK/SAN FRANCISCO (Reuters) – Alphabet’s leadership change has some investors hoping that the owner of Google will take a hard look at the cash-burning ventures championed by its founders.
Google co-founders Larry Page and Sergey Brin announced on Tuesday they were stepping aside as executives of the Internet behemoth they founded 21 years ago, with trusted lieutenant Sundar Pichai, who has run the core Google search business since 2015, taking the reins as CEO of parent Alphabet.
Shares - Alphabet - % - Wednesday - Investors
Shares of Alphabet rose 2% on Wednesday, with some investors saying Pichai’s pragmatic approach and his background at Alphabet’s core business may make him less patient about money-losing projects fostered in recent years by Page and Brin. One of the biggest changes for Pichai will be taking responsibility for those so-called “moonshots,” which are aimed at diversifying Alphabet’s business.
Alphabet has plowed billions of dollars into ventures Wall Street has never been completely sold on, including self-driving cars, atmospheric balloons to deliver internet service, delivery drones and smart contact lenses.
Question - Money - Bets - Leadership - Look
“The question is, will they continue to spend money on these other bets? Under the new leadership, are they going to take a harder look at all of these businesses and start to try to focus more on ones that provide growth,” said Daniel Morgan, a portfolio manager at Synovus Trust Company, which owns Alphabet shares worth over $100 million. “That would add an extra excitement about the stock.”
Alphabet’s Other Bets division, which includes those...
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