It's been two years since Google co-founders Larry Page and Sergey Brin shocked Wall Street by unveiling a sweeping reorganization of the company.
On August 10, 2015, the internet giant announced the creation of Alphabet Inc. (GOOGL) - Get Report , the holding company that oversees its core Google business and the numerous moonshot bets exploring emerging technologies such as glucose-sensing contact lenses and delivering remote internet access via balloons. The new structure has made it much easier for the Google subsidiary (which includes the search business, Google Cloud, YouTube, Android and Chrome) to remain separate from the hodgepodge of "Other Bets" overseen by Alphabet and which Page referred to as "bets in areas that might seem speculative or even strange."
Page recently ruminated on the two-year anniversary of Alphabet in a January letter to shareholders, where he said the new structure has resulted in greater transparency for investors. It has also created a leaner, more efficient Alphabet whose constellation of companies each have a better chance to succeed, he added. Page emphasized that each business is meant to be autonomous with its own CEO, while still being a part of the general Alphabet umbrella.
"We have streamlined efforts where it made sense and in other areas we have seen places to double down," Page wrote. "I also think we have learned a lot about how to set up new companies with a structure for success."
Over the past two years, Alphabet's roster of Other Bets has grown from six businesses to 11 different units. Waymo, Alphabet's self-driving car unit, was spun off into its own company in December 2016; Alphabet's AI research incubator DeepMind has expanded considerably; Google Ideas, a tech-focused think tank, spun off to become Jigsaw in February 2016; Alphabet's smart city project SideWalk Labs launched into a separate unit; and Capital G, one of Alphabet's investing arms, has been broken out.
The other primary businesses that fall under Alphabet include Google X, its secretive moonshot incubator; Calico, which focuses on longevity research; smart home technology maker Nest; Google Ventures, Alphabet's venture capital unit that's invested in Uber, Slack and Nest, among others; Verily Life Sciences; and Access and Energy, which oversees Google Fiber.
A long-standing criticism of Google's Other Bets category is that it continues to burn through cash while making little money. That still continues to be the case, with the category posting a $772 million operating loss in the latest quarter. That is, however, a noteworthy decline from the $859 million operating loss recorded during the same quarter last year.
CFO Ruth Porat is owed a good deal of credit for Other Bets trimming its losses. Since taking on her role in 2015, Porat has pledged to help steer Alphabet's moonshots to profitability, using her prior experience as CFO of Morgan Stanley (MS) - Get Report .
"Our focus on long term revenue growth does not give us a pass on managing expenses," Porat said on an earnings call with investors in 2016. "We invest a lot of time and effort in assessing how to manage for long term growth."
Page echoed this sentiment in his letter to shareholders in January.
"In general we are taking a patient approach to investing our capital, especially significant uses," Page said. "We're not going to invest if we don't see great opportunities and we feel like our track record for picking some important efforts long before others is pretty good."
While Alphabet has tried to make sure its moonshots are on their way to being financially sound, several units in the Other Bets category face an undetermined future.
Nest, which the company acquired for $3.2 billion in 2014, has gone through several rounds of restructuring and is said to have fallen short of revenue targets. Meanwhile, in June Alphabet sold robotics firm Boston Dynamics, which fell under Google X, to SoftBank Group (SFTBY) for an undisclosed amount.
Verily has started to make money, but has faced its fair share of employee turnover. And Google Fiber has undergone various bouts of turmoil, the latest of which forced Greg McCray, CEO of its internet service provider business, to step down. Meanwhile, Google Fiber has quickly become one of Alphabet's biggest expenses.
Amid all this, the Google division continues to roll. In the most recent quarter, revenue jumped 21% year-over-year, fueled by its digital advertising business. Under CEO Sundar Pichai, the company has doubled down on machine learning and artificial intelligence, and its cloud computing platform Google Cloud continues to grow rapidly.
One clear vote of confidence in the reorganization has been Alphabet's stock performance: since Oct. 3, 2015, the day that Google's stock officially became listed under the Alphabet holding company, shares have risen 41%, compared to a 33% rise in the Nasdaq.