Google’s hardware business might not be driving the company’s profits just yet, but that could change in the future. By 2021, the hardware business could soon be driving $19.6 billion in revenue with the Google Home speakers raking in the highest revenue, according to RBC analyst Mark Mahaney, which is being reported by CNBC.
CNBC’s report says that the RBC analyst in his private note to clients has looked at how the future could pan out for the Google hardware division. The analyst projects that in 2018, the hardware division generated around $8.8 billion in revenue. This number combines the Google Pixel phones, the Nest hardware division, the Home speakers and Chromecast revenues.
According to the analysts, by 2021, the Google Home business could alone rake in $8.8 billion in revenues, which will be higher than the Pixel phones, which are expected to bring in $6.9 billion of revenue.
The 2018 projection for Pixel revenues is around $3.4 billion, while the Home speaker business is projected to have a revenue of $3.1 billion, which is not far behind compared to the Google’s smartphones.
Keep in mind that Google’s parent company Alphabet does not report hardware revenues separately. These are all reported in the “other revenues” category, which also includes the Google cloud business, services, Play Store sales, etc.
In fact, when Alphabet reported its third quarter earnings, CFO Ruth Porat had said in on the investor earnings calls that “hardware was only a modest contributor in the third quarter,” though this was because the new line up of Pixel phones was launched just in time for the fourth quarter holiday season of 2018.
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