points by andriy_koval 13 hours ago | 0 comments
Ok, this one happened because they invested into AI hardware build out. Actual operating income grew 30%+ q/q.
[–] JumpCrisscross 13 hours ago
[–] andriy_koval 13 hours ago
google still highly profitable, so operation income indicates how healthy is business, and eps/net income indicates how agressively they reinvesting.
[–] JumpCrisscross 10 hours ago
Yes. But framing one as “actual” implies it conveys broad, ground truths better than the other metrics. It does not. The ground-truth metrics would be forward ROA and ROIC.
[–] andriy_koval 10 hours ago
> The ground-truth metrics would be forward ROA and ROIC.
that's not ground truth in environment when landscape (AI) dramatically changes every quarter, and investments are uncertain bets with huge win potential.
Your ground truth metrics are: 1. How healthy core business: operating income. 2. How aggressively company reinvest: net - operating income.
[–] epolanski 11 hours ago
That was already forecasted, but not that they were going so cash flow negative.
[–] andriy_koval 11 hours ago
Its just interesting how wall street views ant and google as the same caliber companies, even google has way more stronger baseline and ant is way more under the water.
OI isn’t more “actual” than EPS. I remember back when Yahoo traded for less than cash and liquids [1] because investors didn’t trust management not to blow it on stupid shit.
[1] https://www.nytimes.com/2015/12/10/business/dealbook/how-to-...