After 18 years at Google and Alphabet, former Google CEO Eric Schmidt is stepping down

Picture of Eric Schmidt Win McNamee/Getty Images

Alphabet announced today that Alphabet board member and former Google CEO Eric Schmidt will not seek re-election once his terms ends June 19, 2019.

Chairman of the Board of Directors John Hennessy had the following to say in regards to Schmidt:

Eric has made an extraordinary contribution to Google and Alphabet as CEO, Chairman, and Board member. We are extremely grateful for his guidance and leadership over many years.

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Android Authority reached out to Alphabet regarding Schmidt’s imminent departure, but didn’t hear back by press time.

The news isn’t a complete surprise, seeing how Schmidt stepped down as Executive Chairman on Alphabet’s board of directors in 2017. Schmidt remained on Alphabet’s board, though Alphabet CEO and Google co-founder Larry Page noted at the time that Schmidt would serve as a technical adviser on science and technology issues.

Schmidt is best known for his tenure as Google CEO from 2001 to 2017, Google Executive Chairman from 2011 to 2015, and Alphabet Executive Chairman from 2015 to 2017. Schmidt was also elected to Apple’s board of directors from 2006 to 2009 and famously remained on Apple’s board as Google worked on its iPhone competitor.

Before his time at Google, Schmidt served as Novell CEO from 1997 to 2001 and worked at Sun Microsystems as the company’s first software engineer.

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Google revenue for Q4 2018 soars, but there’s a dark cloud on the horizon

A Google logo.

Alphabet just published its financial report for the fourth quarter of 2018. Google revenue soared even higher than Wall Street estimates, bringing in over $39.2 billion, representing a 22 percent increase as compared to the same quarter in 2017.

That totals $136.8 billion in revenue for 2018, up 23 percent over the whole of 2017.

Google’s revenue within each of its main segments grew in the previous quarter, including ad revenue, properties revenue, and even its “other” revenues, which includes things like Pixel devices and services like Google Cloud.

However, despite revenue beating expectations, Google stock still went down after the release of the financial report.

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The likely reasons for this are two-fold. The first reason is the fact that Google’s costs of doing business are going up. For example, traffic acquisition costs were higher this previous quarter than the same time last year. TAC refers to money Google spends to keep its top-dog status, such as the fees Google pays Apple to be the default search engine on iPhones.

The second reason — and likely the one causing the most concern — is that Google’s costs-per-click for its ad sales is going down. In fact, CPC went down 29 percent as compared to 2017 and nine percent compared to Q4 2017.

In other words, Google’s costs of running its business are going up while its competitors in the ad space are driving its margins down. That’s a bad combo.

A third, smaller reason for Wall Street to be a little nervous about Google’s report is the fact that Alphabet’s “Other Bets” category — which houses experimental projects like those stemming from Google’s X division — pulled in less money than Wall Street hoped.

There’s no question that Google’s revenue is very healthy. However, rising competition and costs-of-doing-business are making investors nervous.

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