Ruth Porat, chief financial officer of Alphabet Inc., speaks during a news conference at Michigan Central Station in Detroit, Michigan, on Friday, Feb. 4, 2022.
Jeff Kowalsky | Bloomberg | Getty Images
A string of Google executives have changed their roles in the span of several months, in a shift that has sidelined many of company’s remaining old guard.
The changes encompass high-profile executives such as finance chief Ruth Porat, YouTube CEO Susan Wojcicki and employee No. 8, Urs Hölzle, among others. Some say they have left their roles for a new challenge and others have left to seek opportunities in artificial intelligence.
In February, Wojcicki — one of the most prominent women in Silicon Valley — announced that she was stepping back after nine years at the helm of the Google-owned platform that grew to be the world’s most popular video service. She had been at Google for more than 25 years, after famously lending her garage to Google founders Sergey Brin and Larry Page to use as their first office.
While she’ll still be in an advisory role at Google, she said she wanted to “start a new chapter.”
Wojcicki wasn’t the only executive to leave YouTube. Robert Kyncl, the chief business officer for 12 years, stepped away to become CEO of Warner Music Group at the beginning of the year.
In March, CapitalG founder and longtime Google employee David Lawee stepped down from his role after 17 years at Alphabet, saying he wanted to explore new areas of interest and spend more time with his family.
Hölzle, who has long overseen Google’s technical infrastructure and was its eighth employee, said he would be stepping back from management after 24 years of leading technical teams, CNBC reported in July. Hölzle will be classified as an “individual contributor,” which means he will be working independently and no longer managing employees.
Also in July, Porat announced that she will step down as Alphabet‘s chief financial officer after eight years and take a new role as president and chief investment officer. When asked about the timing of the move, Porat, who was previously Morgan Stanley‘s CFO, said she wanted to take on a different set of challenges.
Porat will also be engaged with policymakers to “recognize the importance of technology” and on issues including employment, economic, competitiveness and infrastructure expansion,” the company said.
“We have a steady and experienced leadership team, many of whom have been with the company for well over a decade, ” said Google spokesperson Courtenay Mencini in statement about the shifts. “We also have a strong bench of leaders at Google who can smoothly transition when people who’ve had long and successful careers here decide to pursue new opportunities inside and outside the company.”
Searching for itself in an AI-first world
As Google looks for replacements for executives like Porat, it’s also searching for its own identity in a pivotal moment in the company’s history.
The company was caught flat-footed last fall when OpenAI launched its AI-powered chatbot ChatGPT, and suddenly found itself in a rare spot where its core search business was threatened.
Industry observers wondered if users could simply get answers from an AI-powered chatbot, how long would they keep entering queries into a search engine? It was an ironic moment for the search giant, given that CEO Sundar Pichai had been talking up the company’s “AI-first” strategy since 2016, with little to show externally.
In June, Google execs admitted to employees that users are “still not quite happy” with the search experience, CNBC reported. Search boss Prabhakar Raghavan and engineering VP HJ Kim spent several minutes pledging to do a better job to employees while Pichai noted that it’s still the most trusted search engine.
Geoffrey Hinton, known as “The godfather of AI” and one of the most respected voices in the field, told The New York Times in May that he was leaving the company after a decade to warn the world about the potential threat of AI, which he said is coming sooner than he previously thought.
Shortly before that, amid a reorganization in Google’s AI teams, the company promoted the CEO of its DeepMind subsidiary, Demis Hassabis, to lead AI for the entire company, and former McKinsey exec James Manyika to become Google’s senior vice president of technology and society and to oversee Google Research.
Google’s AI head, Jeff Dean, who’s been at the company since 1999, became a chief scientist as part of the change. The company called it a promotion, but it effectively took him out of a large leading role in AI to be an individual contributor, reportedly helping oversee Gemini, one of its critical large language models.
The company is also cutting costs, another rarity, while the core search product faces changing user behavior, ad pullbacks and an AI boom that requires increasing investment, all amid a slowing economy and investor calls to reduce spending.
It’s also staring down multiple federal lawsuits, including an imminent antitrust trial set to begin in September that alleges Google illegally maintained a monopoly by cutting off rivals from search distribution channels.
More like other big companies, some employees say
Employees’ perceptions of the company have also changed in recent years.
While potential employees still consider Google a top place to work with extremely competitive perks, it has grown to be more bureaucratic than in its earlier days.
This perception shift has created a “fragile moment” for Google amid the pressure from OpenAI and Microsoft, argued former Google employee Praveen Seshadri in a Medium post that went viral earlier this year.
“I have left Google understanding how a once-great company has slowly ceased to function,” wrote Seshadri in his blog post that detailed the challenges of Google’s growing bureaucracy.
“Like mice, they are trapped in a maze of approvals, launch processes, legal reviews, performance reviews, exec reviews, documents, meetings, bug reports, triage, OKRs, H1 plans followed by H2 plans, all-hands summits, and inevitable reorgs.”
Former Waze CEO Noam Bardin, who quit Google in 2021, shared Seshadri’s post on LinkedIn. In a blog post a couple years earlier, Bardin had written that employees aren’t incentivized to build Google products.
“The problem was me — believing I can keep the startup magic within a corporation, in spite of all the evidence showing the opposite,” he wrote in his critique of the company.
Like Seshadri and Bardin, a number of AI specialists have left the company, saying it had grown too bureaucratic to get things done.
Eight AI researchers who created “Transformers,” an integral part of the infrastructure behind ChatGPT and other chatbots, have left the search giant since 2017 — many of them going on to start their own companies. Five of them left in 2021 alone.
Llion Jones, who departed Google this month to start his own company focused on AI, told CNBC’s Jordan Novet, “the bureaucracy had built to the point where I just felt like I couldn’t get anything done.”
Other AI researchers at Google have made similar complaints in recent months. Several have gone on to start their own companies focused on AI, where they have more agency over vision and speed.
In February, longtime product exec Clay Bavor said after 18 “wonderful years” at Google, he was leaving to start an artificial intelligence company with former Salesforce co-CEO Bret Taylor. “We share an obsession with recent advances in AI, and we’re excited to build a new company to apply AI to solve some of the most important problems in business,” Bavor wrote at the time.
“We’ve made intentional efforts throughout the year to move quickly with nimble teams,” said Google spokesperson Courtenay Mencini. “For instance, products like Bard and SGE [Search Generative Experience] are being developed by small, fast-moving teams that have been built for these high-priority efforts.”
Despite its efforts, the company faced criticism from investors and its own employees when it quickly tried to announce its ChatGPT competitor Bard, which it started opening up to the wider public in March. While the rollout’s reputation has rebounded after several updates and a successful developer conference, the company still has yet to launch SGE to the wider public.
The company has also become less flexible as it strives to get employees back into the office.
Google recently cracked down on its hybrid three-day-a-week office policy to include badge tracking, and noted attendance will be included in performance reviews, CNBC previously reported. Additionally, employees who already received approval for remote work may now have that status reevaluated.
There’s also a new emphasis on cost-cutting that has taken some employees by surprise.
Even if the company had been considered slower moving, at least it had been considered secure — commonly known as a place where employees could “rest and vest.” That changed with the company’s first-ever mass layoffs in January, where Alphabet abruptly announced it was eliminating about 12,000 jobs, or 6% of its workforce, in an overnight email. Some employees reportedly arrived at work to discover their badges no longer worked. It then declined to pay out the remainder of employees’ approved leave time.
While the company included competitive severance packages, some employees lost trust in leadership, who had long encouraged employees to be kind, humble and open-minded, or “Googley.”
The company has also reduced spending on real estate, even asking employees in its cloud unit to share desks. It’s also cut down on desktop PCs and equipment refreshes for employees. It started cutting travel and events late last year.
In an all-hands meeting last September, employees voted to ask Pichai why the company is “nickel-and-diming employees” with some of its cutbacks on perks and travel.
Google’s culture can still be enjoyable even if some things, like certain swag items, are getting taken away, the CEO argued.
“I remember when Google was small and scrappy,” Pichai said. “We shouldn’t always equate fun with money. I think you can walk into a hardworking startup and people may be having fun and it shouldn’t always equate to money.”
Pichai’s statement touched a nerve. Yes, many people joined Google so their work would immediately have an impact of many more users than other companies. It’s still considered one of the top places to work, with opportunities to tackle some of the industry’s biggest problems. But, alongside all that, money and perks had flowed generously, regardless of the speed at which projects moved.
Now, the company faces its biggest challenge yet, which falls on the shoulders of Pichai and the next guard — trying to recreate the magic of its early days along with delivering revenue while being under more pressure than ever.
Signage at the Broadcom Inc. headquarters in San Jose, California, U.S., on Monday, June 2, 2025.
David Paul Morris | Bloomberg | Getty Images
The sell-off in artificial intelligence stocks continued unabated Friday stateside. Broadcom shares tumbled more than 11% as investors grew concerned over lower margins and uncertain deals. Names such as Nvidia, Advanced Micro Devices and Oracle fell in sympathy, which caused major U.S. indexes to close lower.
It was a motif patterning the week. Even though the Dow Jones Industrial Average rose 1.1% week on week on the back of outperformance by financial stocks, tech names dragged down the S&P 500 and the Nasdaq Composite, which fell 0.6% and 1.6% respectively for the week.
That said, investors could have just been jittery amid the narrative of an apparent AI bubble, and were spooked by any sign of bad news. After all, Broadcom’s earnings — as well as its guidance for the current quarter — breezed past expectations.
“Frankly we aren’t sure what else one could desire as the company’s AI story continues to not only overdeliver but is doing it at an accelerating rate,” Bernstein analyst Stacy Rasgon, who has a “buy” rating on Broadcom, wrote in a Friday note.
Future prospects also look rosy, according to UBS. “We expect high profitability and the accelerating impact of the AI, power and resources, and longevity themes to drive 2026 performance,” said strategist Sagar Khandelwal.
But in the near term, investors may still be flighty, unless something concretely reassuring, such as Oracle achieving positive cash flow, reassures them the snapping sound is just a twig in the forest.
Oracle will finish data centers on time. The company issued its response to a Bloomberg report, which cited unnamed people, that Oracle will complete data centers for OpenAI in 2028 rather than 2027. “There have been no delays,” Oracle said.
Coinbase to have an in-house prediction market. It will be powered be Kalshi, a source close to the matter told CNBC, and is a play to expand asset classes available on the cryptocurrency exchange.
The end of the ‘Berkshire way’? Several aspects of Berkshire Hathaway’s leadership transition are signaling that the conglomerate is drifting away from the famously decentralized “Berkshire way,” CNBC’s Alex Crippen writes.
[PRO] China’s food security strategy. The spate between Beijing and Washington over soybean purchases has highlighted the evolution of China’s domestic agriculture industry. Goldman Sachs thinks this is the best way to play the sector.
And finally…
A bear statue stands outside the Frankfurt Stock Exchange, operated by Deutsche Boerse AG, in Frankfurt, Germany, on Friday, March 13, 2020. Top European CEOs are fearing a euro zone recession as a confluence of economic shocks continues to threaten the outlook for the bloc.
U.S. President Donald Trump’s verdict on Europe: a “decaying” group of nations led by “weak” people. His criticism in a recent Politico interview adds to a tough period for the bloc, with challenges on multiple fronts testing European leaders in the final weeks of the year.
This week looks set to be critical, with a high-stakes summit in Brussels and the European Central Bank’s final policy meeting of the year. Key topics for this week include defrosting frozen Russian assets for Ukraine aid; EU vs. U.S. in trade and tech, and updated economic figures at the ECB meeting.
Sometimes the stakes are so high, the degree of difficulty so immense, that it simply may be too hard to game. When that’s the case, no amount of formal research will help you fathom the stock implications. Yet, you have inherited the issues and they must be dealt with — or you are too at sea to judge them. We have not one, but two situations — and potentially three — that concern me especially because the price-to-earnings multiples are very high. The two stocks in question? Broadcom and Costco . Broadcom, the nervous system for many of the hyperscalers, is trying to encroach upon fellow Club name Nvidia , the leading AI chipmaker whose fast processors are at the heart of so many artificial intelligence data centers. Let’s take Broadcom first. For its custom AI chip business, Broadcom’s list of clients include Alphabet -owned Google, Meta Platforms , TikTok parent ByteDance, and OpenAI . Additionally, AI startup Anthropic also was recently revealed as a $10 billion customer . Meanwhile, Broadcom is rumored to be talking with Microsoft about shifting its business away from its director competitor in the custom chip design space, Marvell Technology . And there were also concerns that Marvell was losing some business from Amazon. Importantly, Marvell CEO Matt Murphy, whom I trust implicitly, came on “Mad Money” and said he hadn’t lost any business. I believe him. At the same time, Bloomberg News on Friday reported that Oracle pushed back the opening date for some of the data centers it’s building for OpenAI, the giant startup run by Sam Altman. OpenAI happens to be committed to spending $300 billion over five years for computing power from Oracle. That figure is thought to be rock solid because it is in Oracle’s RPO, or remaining performance obligations. It represents more than half of Oracle’s $523 billion RPO. Anything that indicates that OpenAI is not money good could cause a tremendous negative ripple for this entire ecosystem — not just OpenAI, although OpenAI is at the center of the debate. According to Bloomberg, the timeframe for the pushout is from 2027 to 2028, with labor and material shortages cited as the reason. Importantly, Oracle said in a statement there have been “no delays to any sites required to meet our contractual commitments, and all milestones remain on track.” Oracle is to be trusted because it is Larry Ellison’s company and Ellison doesn’t make false claims. But is Sam Altman to be trusted? We don’t know enough about him and his company is private. Bloomberg could be wrong in its story. But maybe it isn’t. Many took the story as gospel despite Oracle’s response in that statement. It is possible, however, for everyone to be right. We know from Coreweave’s quarterly report that these sites can have problems being built . They are very complicated and companies are all fighting for the same components. Oracle holds itself out as an expert in building them. What happens, however, if Oracle has problems building the data center sites for OpenAI and that is the source of the pushout? What happens to the pace of chip orders from Nvidia, which is almost always a part of every data center? These are the fundamental questions that must be answered. We thought we would get some clarity on the broader state of the AI buildout when Broadcom reported quarterly results Thursday night. But the answer was obscured by an issue identified by CFO Kristen Spears on the Broadcom conference call. At the beginning of the call, Broadcom said it had some $73 billion in AI backlog, including orders for its AI server systems that contain its custom chips and other components. That number excited Wall Street and initially drove the stock up about $15 a share in after-hours. But later on the call, Spears said the AI system business was less profitable than other chip-only orders because of some pass-through costs with lower margins. When Spears revealed that, Broadcom’s stock did the dreaded pirouette and it fell to about $380, giving up a frightening $35 from its overheated after-hours level. When that happens it’s a nightmare, which is why the stock fell even more during Friday’s regular session and ended the day at $359.93. Some of that additional decline came from the first issue I mentioned, the possible delay related to Oracle’s work for OpenAI. The rest was from the pass-through issue. AVGO YTD mountain Broadcom’s year-to-date stock performance. Now let’s go back to the first issue. I never like to be in a battleground because the possible results are too murky. These issues created their own battleground. They can’t really be resolved because OpenAI is private. When we hear about potential delays involving OpenAI, even if other reasons are cited in the article, we can’t help but wonder whether it will have the money to meet all its obligations in the coming years. How do we know if Broadcom’s business is not as robust as we thought? We do know OpenAI has access to $40 billion in capital , or at least that it says it has that access. We do know that it just landed a billion dollars from Disney for a stake in the company. It was all very odd. Why didn’t OpenAI have to pay Disney and not vice versa? Was it really about making sure OpenAI was able to get the characters for its AI video generation tool Sora and while blocking Google? Still, I found the deal murky and very similar to the kinds of crazy deals I heard about in 2000, deals that everyone told me were smart and I thought were preposterous. All of this is very theoretical. I don’t like theoretical. Who wants to be caught in this web of intrigue? Not me. Not anyone else. Hence the collapse in Broadcom’s stock. I can go round and round about how OpenAI is worth more than we thought because of this business-to-business deal. Enterprise business is worth more than business-to-consumer deals, the current focus model of OpenAI. That’s more like the aforementioned Anthropic, whose heavyweight investors include Amazon, Microsoft and Google. Anthropic is loved by the Street. OpenAI is not as trusted because of the craziness we have seen from the firm, including CFO Sarah Friar’s odd comment that the government could always “backstop” the company . That’s been denied later on by Friar, but it’s kind of a genie-out-of-the bottle comment. Again, it’s all too hard. Which means that Broadcom’s stock is worth less than we thought, at least around this one issue. Once again, we have to play a game of “who do you trust?” I trust Hock Tan, the longtime CEO of Broadcom, which means you shouldn’t be bailing from the stock. Others clearly have less faith, or else the stock wouldn’t have come down a horrendous $46, or 11.4%, on Friday. This is not the first time Hock has been doubted by the market. It is also not the first time that the market has been wrong. I am with Hock. We are, of course, standing by Broadcom, which even with Friday’s pullback remains up 55% year to date. However, because its price-to-earnings ratio is so high, at almost 42 before earnings, there’s not much room for error. That’s just how it goes with high-multiple stocks. So, it’s fraught and we don’t like fraught – the battleground. We do think Hock will be right, just as we did a few years ago when the stock broke down after another quarter and it turned out to be a false worry accompanied by a huge amount of insider buying . Could that happen again? I think so. We just don’t know yet. To sum up, my judgment is that Broadcom is fine, but the position is a lot harder to defend at this moment. We will defend it by owning it, not buying more. Now, let’s cover Costco. The first, and most salient, issue is the P/E multiple, and yes it almost always comes back to the multiple. At 43 times next year’s earnings, it is high versus the S & P 500, which trades at roughly 22 times forward earnings. But Costco’s valuation being well above the market is not unusual historically speaking. In fact, at this time a year ago, Costco’s P/E ratio was north of 50 while the S & P 500’s was still around 22, according to FactSet data. Costco’s multiple coming down would be fine if the stock weren’t near its lows. What we’re seeing now indicates that the fear is the stock must go lower because investors are not as willing to pay up as much for future earnings — that is how you get multiple compression. To be sure, Costco’s quarter was solid, in line with the estimates. But it wasn’t better than the estimates. The earnings have to be better than the estimates to maintain its high multiple: witness Walmart with a 40 multiple, as close to Costco as I can recall. That, in and of itself, is telling. Why is that? There’s a couple of reasons. First, customers aren’t renewing their membership as they used to. We have seen this impact for several quarters, and it is quite unusual. The company has an excuse: These are mostly younger people who get their membership online versus warehouse signups. But I don’t care about the excuse. It is a red flag. Further, there was “lumpiness” to the quarter, something I don’t like but I think got better as the quarter ended. Third, Costco CFO Gary Millerchip – a rather new hire from Kroger brought in to replace the irreplaceable long-time finance chief Richard Galanti – once again used the word “choiceful” about the consumer. Choiceful, I think, is a code word for “too expensive.” I don’t associate that word with Costco. Suboptimal. COST WMT YTD mountain Costco’s year-to-date stock performance versus Walmart. So, what to do? As I said during a Morning Meeting last week , I am very concerned about this and about how the analysts seem to be focused more on Costco’s technology initiatives – although two analysts on the conference call did ask on about the renewal rate, and the answer was that thanks to some targeted initiatives, the renewal rate for online members will be a little better than it was. That wasn’t reassuring. Unlike Broadcom, the high multiple here can’t stay high when the comparable sales aren’t much better than expected. This distresses me. I have been kind of possessed by it. Is Walmart catching up? Is Walmart passing it? Is Walmart better than Costco? Comparisons, as I know from my mother, are odious. But it’s a real worry. I was thinking Costco would go up when it reported that quarter because there was progress with online and there was additional talk about bolstering its advertising initiatives like Walmart has. But they are so far behind, that, again it is worrisome. I play with an open hand. I weigh all of this against a long history of being special. I don’t think it helps that Costco is tussling with the administration over tariffs and, before that, diversity efforts . Whether you like or agree with Costco, you have to accept that some people might be turned off by these stances. As a shareholder, I am not happy about this because I am trying to figure out the real reason why there is a lower renewal rate, especially among young people. Why be as concerned as I am? Because of Target , that’s why. Many stuck with Target long after things went awry there. It’s retail. Retail is one of the hardest businesses. You can slip. You can fall. That’s why you should not be surprised if we take action on the position. I hate to ever sell this stock. The company is so amazing. My trips to the stores remain exciting. But we can’t afford a Target. We just can’t. That said, you have to expect some action. I can’t lose sleep over this one. So, sigh. It’s not what we want. But it almost has to happen. (Jim Cramer’s Charitable Trust is long COST, AVGO, NVDA, AMZN, MSFT and META. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
Software company ServiceNow is in advanced talks to buy cybersecurity startup Armis, which was last valued at $6.1 billion, Bloomberg reported.
The deal, which could reach $7 billion in value, would be ServiceNow’s largest acquisition, the outlet said, citing people familiar with the situation who asked not to be identified because the talks are private.
The acquisition could be announced as soon as this week, but could still fall apart, according to the report.
Armis and ServiceNow did not immediately return a CNBC request for comment.
Armis, which helps companies secure and manage internet-connected devices and protect them against cyber threats, raised $435 million in a funding round just over a month ago and told CNBC about its eventual plans for an IPO.
Armis CEO Yevgeny Dibrov and CTO Nadir Izrael.
Courtesy: Armis
CEO and co-founder Yevgeny Dibrov said Armis was aiming for a public listing at the end of 2026 or early 2027, pending “market conditions.”
Armis’s decision to be acquired rather than wait for a public listing is a common path for startups at the moment. The IPO markets remain choppy and many startups are choosing to remain private for longer instead of risking a muted debut on the public markets.
Its latest funding round was led by Goldman Sachs Alternatives’ growth equity fund, with participation from CapitalG, a venture arm of Alphabet. Previous backers have included Sequoia Capital and Bain Capital Ventures.
