Google Cloud Earnings Preview: Microsoft, Wiz, CrowdStrike Take Center Stage

From Google’s potential blockbuster acquisition of security startup Wiz to the massive CrowdStrike and Microsoft chaos, here’s four big things to watch for during Google Cloud’s earnings results slated for Tuesday.

Google Cloud’s parent company Alphabet is releasing the financial earnings results for its second quarter 2024 on Tuesday with potential huge discussions around the CrowdStrike-Microsoft outage chaos, cloud sales growth and the possible blockbuster acquisition of Wiz.

The $38 billion Mountain View, Calif.-based cloud computing giant will unveil total revenue, profitability and its overall financial earnings for the second quarter 2024 on July 23 at 1:30 p.m. PT.

CRN breaks down the four biggest things to watch for surrounding Google Cloud earnings results for Q2 2024.

Google Cloud Total Sales Estimate For Q2 2024: $10 Billion

Zacks Consensus Estimate is predicting that Google Cloud revenue hit just over $10 billion, approximately $10.08 billion, during the second quarter 2024.

This would suggest Q2 2024 year-over-year growth of around 26 percent for Google Cloud.

Google Cloud has yet to hit the $10 billion quarterly sales market, meaning Q2 could be the largest sales quarter in company history.

Google Cloud generated total sales of $9.6 billion in first quarter 2024, up 28 percent year over year. This is in line with Zacks’ estimate of 25 percent growth year over year.

Wall Street analysts say ongoing investments in AI, machine learning and cloud infrastructure are driving greater adoption of Google Cloud Platform (GCP) services.

What Will Google CEO Sundar Pichai Say About Microsoft-CrowdStrike Chaos?

On Friday, one of the largest IT incidents of 2024 occurred when a faulty CrowdStrike update shut down millions of customers access to Microsoft, including airlines, 9-1-1 centers and healthcare providers. Over 8.5 million Microsoft devices were impacted.

It is no secret that Microsoft is one of Google’s largest competitors in terms of cloud computing, artificial intelligence, infrastructure, software, devices as well as a slew of other IT markets that the two tech giants compete for. The two also share many large enterprises and Fortune 500 customers together.

It will be interesting to see what Google’s CEO Sundar Pichai says about the incident which was one of the biggest tech security issues of 2024.

Furthermore, it could be an opportunity for Google to potentially boast about its cybersecurity, operating systems or the company itself compared to its biggest rival.

Google Execs Could Hint At $23 Billion Wiz Acquisition

The biggest story this quarter coming out of Google was the news of its potential plan to acquire cybersecurity startup Wiz for $23 billion.

This would mark the most significant acquisition from Google in its history.

Google does have $24 billion in cash and cash equivalents as of March 31, 2024, meaning this acquisition is a real possibility.

“For Google, this would be a shot across the bow at Microsoft and Amazon, making a major bet on the cybersecurity space to complement its flagship GCP offering in the cloud,” said Wedbush Securities analyst Dan Ives in a recent investor note.

Typically, executives on earnings calls do not discuss potential upcoming acquisitions. With the IT security landscape currently on the world stage due to the Microsoft-CrowdStrike incidence, there is a real possibility Google execs will talk about Wiz during their earnings report on Tuesday.

Google Cloud Profitability

Profitability eluded Google Cloud for years until 2023, when the company reported a positive operating income of $191 million for first time ever in Q1 2023.

One year later, Google Cloud reported operating income of $900 million in Q1 2024.

In Q4 2023, Google Cloud’s operating income was $864 million, up significantly from an operating loss of $186 million year over year.

It will be interesting to see if Google Cloud not only remained profitable in Q2 2024, but how it stacks up against prior quarters.