Alphabet Inc.

Welcome, everyone, and thank you for standing by for the Alphabet first quarter 2021 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone. If you require any further assistance, please press star 0. I'd now like to hand the conference over to your speaker today, Jim Friedland, Director of Investor Relations. Please go ahead.

Thank you. Good afternoon, everyone, and welcome to Alphabet's first quarter 2021 earnings conference call. With us today are Sundar Pichai, Philip Schindler, and Ruth Porat. Now, I'll quickly cover the safe harbor. Some of the statements that we make today regarding our business, operations, and financial performance, including the effect of the COVID-19 pandemic on those areas, may be considered forward-looking and such statements involve a number of risks and uncertainties that could cause actual results to differ materially. For more information, please refer to the risk factors discussed in our most recent Form 10-K filed with the SEC. During this call, we will present both GAAP and non-GAAP financial measures, A reconciliation of non-GAAP to GAAP measures is included in today's earnings press release, which is distributed and available to the public through our investor relations website located at abc.xyz slash investor. And now I'll turn the call over to Sundar.

Thank you, Jim. Good afternoon, everyone. After a hard year, people in some parts of the world are beginning to rebuild their lives, businesses, and communities. But recovery is far from uniform across the globe, as the tragic scenes in countries like India and Brazil remind us. We are continuing to help support public health officials in their vital and urgent work. Our focus is on providing authoritative information. We are helping over 100 government agencies and nonprofits worldwide distribute critical information and billions of PSAs about COVID-19 and vaccines. And Google Cloud technology is powering a virtual agent to help make vaccination appointments over the phone, supporting 28 languages and dialects for those with limited internet access. We are focused on doing our part to help. In some parts of the world, the economy began to rebound, which created a rising tide in the first quarter that benefited a number of sectors, including existing and emerging companies and partners. For example, data suggests that investment in startups is at an all-time high. Our product releases are returning to a regular cadence. I'm particularly excited that our developer event, Google I.O., is back this year, all virtual and free for everyone on May 18 through 20. We'll have significant product updates and announcements, and I invite you all to tune in. Today, I'll briefly mention a few highlights from the past quarter and go a bit deeper on cloud. Then Philip will discuss advertising and partnership developments. Finally, Ruth will cover the quarterly results. Quickly turning to product highlights of the quarter. Our knowledge and information services like Search and Maps remain at the heart of our mission to provide helpful and accurate information during important moments. People have turned to Google Search more than ever since the pandemic began. We see hundreds of millions of searches every day for COVID and related health information. People are also searching for jobs. To help them, job seekers can now use search to quickly and easily find roles that do not require a college degree, and we are working together with the top employment websites to make the service even better. MAPS will be adding over 100 AI-powered improvements this year, such as Indoor Live View, which helps you navigate airports, transit stations, and malls using augmented reality. Last quarter, I mentioned Google News Showcase, our $1 billion investment in the news industry. I'm pleased to see continued momentum this quarter with new launches in the UK, Italy, Argentina, and Australia. In Q1, we added more than 170 publications across 12 countries, with more coming soon. With respect to YouTube, people continue to find all types of informational content, from educational videos to podcasts. In fact, according to a recent study conducted by Ipsos, 77% of respondents say they used YouTube during 2020 to learn a new skill. YouTube Shorts continues to gain popularity with over 6.5 billion daily views as of March, up from 3.5 billion at the end of 2020. We've added a new metric to our transparency reports called the Violated View Rate. which will help us estimate what percentage of views on YouTube come from content that violates our policies. In Q4 of last year, YouTube's violated view rate was between 16 and 18 views out of every 10,000. This is down over 70% compared to the same quarter in 2017, in large part thanks to our investments in machine learning. Let me also mention Chrome OS, which this quarter celebrated 10 years. It's been a valuable tool for millions of students and teachers during the pandemic. According to third parties, Chromebooks were the most popular device in K-12 education globally for the last year. Next, I'll move to cloud, where we continue to see strong performance across both Google Cloud Platform and Workspace. Q1 revenue grew 46% year-over-year, with GCP's revenue growth rate once again meaningfully above cloud overall. we continue to unlock the value of the Google ecosystem by signing multi-year, multi-product partnerships with companies like Global Payments and Grupo Global. And just yesterday, we announced a new Google-wide partnership with Univision, which is migrating to our cloud, continuing to distribute content on YouTube and reaching customers via play and ads. In cloud, there are three distinct market trends shaping our growth and driving our product and go-to-market strategy. First, we see very strong customer momentum in the data cloud. Our expertise in real-time data and analytics is winning companies like Twitter and Ingersoll Rand, who are moving their complex data workloads to Google Cloud. Our strength in AI and ML is also helping financial services customers like HSBC, Commerce Bank, SEB Group, and BBVA improve efficiency of payments, reduce fraud and risk, and deliver faster payment solutions. This past quarter, we released new functionality for BigQuery, delivering significantly better performance for business intelligence queries. Second, we are seeing customers wanting a robust infrastructure cloud in order to create operational efficiencies and reduce IT costs. We are winning large IT transformation deals with companies that are migrating their data centers to Google Cloud. Multicloud remains a differentiator as it provides the easiest and most open development environment for customers like Taylor's, allowing them to access and move their data between various clouds. Third, we continue to deliver helpful innovations to enable hybrid work with Google Workspace. This includes digital tools for frontline workers like nurses and retail store workers, as well as new security offerings. These innovations have helped grow our revenue per seat and the number of seats in the last quarter. Workspace is being adopted by customers, including Carole T in healthcare, Sun Life in financial services, and Airbus in manufacturing and aviation. Now, a brief update on other bets. Waymo's fully autonomous public ride hailing service in Phoenix is providing hundreds of rides per week. In San Francisco, Waymo has begun limited employee testing. I'm pleased by the progress here and look forward to Waymo's continued momentum under the leadership of new co-CEOs, Takedra and Dimitri. Calico and its partner, AbbVie, announced that it has entered clinical stage programs for new drug therapies for cancer and neurodegenerative diseases like ALS, Parkinson's disease, and traumatic brain injury. Before I close, I want to mention that in 2021, in the U.S. alone, We plan to invest over $7 billion in offices and data centers and create at least 10,000 new full-time jobs. And as we do this, we continue to make progress on our sustainability goals. We matched our operations with 100% renewable energy for the past four years, and we are working towards operating on carbon-free energy around the clock by 2030, a far more ambitious goal that we hope will be transformative for the industry. Five of our data centers in Europe and North America are already operating near or at 90% carbon-free energy around the clock. We're also working towards our commitment to help 1 billion people make more sustainable choices with our services by 2022. One example of how we are doing this is a new AI-powered feature in maps that will show the route with the lowest carbon footprint when ETAs are the same. You'll also be able to compare the carbon impact between droughts. Finally, as we look ahead to the rest of 2021, our four big themes continue to guide us. First, building and providing the most helpful products and services. Second, continuing to earn the trust of our users by investing in high-quality information and keeping users' data safe and private. Strong execution as a company, particularly as we start to reopen our offices. And fourth, building sustainable value in our own business and for our partners. As always, thank you to our Googlers around the world for a great start to the year. To everyone, I look forward to seeing you at I.O. Over to Philan.