Mountain View, Calif. – February 2, 2023 – Alphabet Inc. (NASDAQ: GOOG, GOOGL) announced its financial results for the quarter and fiscal year ended December 31, 2022. Revenues for the fourth quarter of 2022 totaled $76 billion, up 1% year over year, or up 7% in constant currency, and $283 billion for the full year 2022, up 10%, or up 14% in constant currency. Operating income for the quarter was $18.16 billion and operating margin was 24%, compared to $21.89 billion and 29% for the same period in 2021. Net income for the quarter was $13.62 billion and diluted EPS was $1.05, compared to $20.64 billion and $1.53 for the same period in 2021.
CEO Sundar Pichai highlighted Alphabet's investments in AI and its focus on long-term, financially sustainable growth. CFO Ruth Porat highlighted the company's efforts to re-engineer its cost structure in a durable way and to build vibrant, growing businesses across Alphabet.
Alphabet also announced a reduction in its workforce of approximately 12,000 roles, which is expected to incur employee severance and related charges of $1.9 billion to $2.3 billion in the first quarter of 2023. In addition, Alphabet expects to incur exit costs relating to office space reductions of approximately $0.5 billion in the first quarter. Finally, Alphabet completed an assessment of the useful lives of its servers and network equipment, resulting in a change in the estimated useful life of its servers and certain network equipment to six years, which is expected to result in a reduction of depreciation of approximately $3.4 billion for the full fiscal year 2023.
Overall, Alphabet reported a slight year-over-year increase in revenues and experienced a decrease in operating income, largely due to the company's cutting costs and restructuring. Despite the slight decrease in profits, Alphabet's investments in AI and long-term strategies are expected to pay off in the future, making the company well-positioned for success.