Tech giant Alphabet’s (NASDAQ:GOOG) (NASDAQ:GOOGL) Google arm quietly let go of several hundred of its employees recently, dropping them mainly from advertising sales. The reports—which were based on an internal memo—noted that there were around 30,000 people in the ad sales unit as things were, but a planned restructuring would send many of them out of the company.
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Word first emerged about the move during a meeting last week. Interestingly, this move came not long after Google revealed that its ad revenue was up from $54.5 billion to $59.65 billion, proving that the ad sales team was doing its job and then some. So what prompted the layoffs from a division that was not only profitable but increasingly so?
AI Coming for Our Jobs
Yesterday, we offered up a report suggesting that AI was coming for our jobs. That seems to be exactly what’s happening at Google, as one report noted that several ad sales workers’ jobs had recently been automated by artificial intelligence. The move is regarded as something of a mixed blessing; Google may actually lose some ad sales from small businesses that need people to help them place ads but will gain a big pot of cash from no longer paying out salaries. Some have even suggested that the means by which these layoffs were handled was perhaps the worst way it could have been, engendering uncertainty within the organization and likely hurting performance.
Is Alphabet Stock a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Strong Buy consensus rating on GOOGL stock based on 28 Buys and seven Holds assigned in the past three months, as indicated by the graphic below. After a 55% rally in its share price over the past year, the average GOOGL price target of $155.91 per share implies 9.74% upside potential.
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