The above graph represents the Alphabet cost of revenues by quarter, stating from fiscal Q4 2014 to the recently completed quarter. Alphabet’s total cost of revenues increased 17.3% YoY in Q4 2019, to an all-time high of $21,020 million – representing 45.6% of the company’s quarterly revenue. The increase was primarily due to the increase in TAC (Traffic Acquisition Costs).
Alphabet’s quarterly costs and expenses hit a record $36,809 million during the fourth quarter of 2019.
|Note||Alphabet fiscal year starts from January 1st|
Alphabet’s total cost of revenues crossed $10 billion mark for the first time in Q4 2016. The company reported over 30.2% YoY increase in its cost of revenues, amounting to $10,661 million, globally. The company took 3 years to double its cost of revenues, clocked $21,020 million in Q4 2019.
It is important to note that the Cost of revenues consists of TAC which are paid to Google Network Members for ads displayed on their properties and amounts paid to the company’s distribution partners (browser providers, mobile carriers, original equipment manufacturers, and software developers) who make available its search access points and services. It also includes Content acquisition costs, Expenses associated with data centers and other operations; and Inventory related costs for hardware.
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