TIVP005: Alphabet (GOOGL): Searching for Quality w/ Shawn O’Malley

In today’s episode, Shawn O’Malley (@Shawn_OMalley_) breaks down Alphabet — the parent company of Google, which is one of the most valuable companies in the world and probably an important part of your everyday life. Shawn explores how Google got its start, how Alphabet makes money from seemingly-free services like Gmail, Google Maps, and Google Earth, and what to make of how AI and regulatory threats could reshape Alphabet’s business model. Shawn paints a high-level picture of the most important things to understand about this incredible business and then goes through his process for valuing each individual business unit at Alphabet. You’ll learn how Alphabet’s different business units are structured, how they make money, and how Shawn assembles a “sum-of-the-parts valuation” for the company, plus so much more! Prefer to watch? Click here to watch this episode on YouTube. IN THIS EPISODE, YOU’LL LEARN 00:00 - Intro 05:39 - Which subsidiaries make up the Alphabet conglomerate 07:58 - What to make of Alphabet’s “Moonshot Bets” division 10:33 - How to factor in Waymo and other speculative technologies into the company’s valuation 23:58 - How AI is changing search 29:22 - In what ways Alphabet earns different forms of advertising revenue 31:33 - Why YouTube is arguably the most valuable streaming platform in the world 39:37 - Why regulatory concerns aren’t as much of a worry as you might think 45:42 - Mind-blowing stats about just how large and influential Alphabet is 48:16 - How to put together a sum-of-the-parts valuation for Alphabet *Disclaimer: Slight timestamp discrepancies may occur due to podcast platform differences. BOOKS AND RESOURCES Get smarter about valuing businesses in just a few minutes each week through our newsletter, The Intrinsic Value Newsletter. Aswath Damodaran on the Magnificent 7. Check out Alphabet pitch on the Value Investors Club. Adam Seessel's book, Where the Money Is: Value Investing in the Digital Age. Adam Seessel’s past appearances on the Millennial Investing podcast in: November 2023, September 2022, and June 2022. Adam Seessel on the We Study Billionaires podcast. Learn more about Alphabet’s Moonshot Bets. Attend the 2025 Berkshire Hathaway shareholder meeting and meet-ups with The Investors Podcast Network Check out the books mentioned in the podcast here. Enjoy ad-free episodes when you subscribe to our Premium Feed. NEW TO THE SHOW? Follow our official social media accounts: X (Twitter) | LinkedIn | Instagram | Facebook | TikTok. Browse through all our episodes (complete with transcripts) here. Try Shawn's favorite tool for picking stock winners and managing our portfolios: TIP Finance. Enjoy exclusive perks from our favorite Apps and Services. Learn how to better start, manage, and grow your business with the best business podcasts. SPONSORS Support our free podcast by supporting our sponsors: TurboTax Public Airbnb Connect with Shawn: Twitter | LinkedIn | Email HELP US OUT! Help us reach new listeners by leaving us a rating and review on Spotify! It takes less than 30 seconds and really helps our show grow, which allows us to bring on even better guests for you all! Thank you – we really appreciate it! Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm