Alphabet needs to act quickly to reduce personnel and payroll costs, present a clear action plan to investors, reduce losses at its self-driving unit Waymo, adapt to a slower growth environment, and run its business more efficiently, TCI Fund Management wrote in a letter to CEO Sundar Pichai.
TCI, which owns 0.27% of Alphabet, believes that Google has too many employees, that costs per employee are too high, and that Alphabet pays some of the highest salaries in Silicon Valley, noting that the company has increased its workforce by 20% annually since 2017 and has more than doubled since then.
TCI also asked Alphabet to disclose operating profit margin targets and reduce losses in its Other Bets, which includes Waymo and other special projects.
TCI said that investments in Waymo were not justified and that losses should be drastically reduced, adding that the autonomous vehicle technology unit had generated $3 billion, but had so far generated operating losses of $20 billion. TCI demanded that the unit reduce operating losses by at least 50%.
The sources for this piece include an article in TheRegister.