I don't compare investing to marriage, but at least to a long-term relationship. So when I buy a stock, I don't really want to exit it. When am I leaving? If I see a problem in the management approach, if I see a problem in the technology, or if I see a problem in the market conditions. Unfortunately, I see problems with Google in all three areas. That's why I reconsidered my Google investment and will explain my decision at the end of my article. Of course, what I am about to tell you is not investment advice. I'm just trying to give you some perspective. I believe that this perspective can be useful to you, especially when investing in technology companies traded on Nasdaq.

I have been a Google investor since the artificial intelligence revolution made itself felt in the markets with chat gpt in April last year. Because Google was actually a player that entered artificial intelligence much earlier. He invested $400 million in one of the world's most important artificial intelligence companies, such as Deep Mind, and the skill sets within Google are very advanced. In addition, Google has plenty of data, which is one of the most important issues for the development of artificial intelligence. He can access crazy information both from the search engine and from YouTube. In this context, I believed that Google would eventually give a strong response to fast startups like chat gpt, even if it was a little late. He can still give it.

But what has happened in the last 8 - 9 months, especially the cycle that Google has been in since the beginning of this year, is not going positively at all, and this may have two effects on Google. One of them may lose the artificial intelligence race, which you see is crazy right now. More importantly, perhaps Google may decline on the search engine side, which is its current main source of income. Today we will focus a little more on the artificial intelligence aspect. But eventually artificial intelligence may come and eat the search engine side, and Google's culture, organization and top management seem to be unable to cope with this.

Google has not been able to get any share in the crazy artificial intelligence rally that has been going on since the beginning of the year. Nvidia is up 66%, Meta is up 41%, Amazon is up 17%, and even Microsoft is up 10%. Google has no rise, on the contrary - it fell by 0.2. It was something I never expected. I thought that the wind of artificial intelligence would definitely take Google somewhere. The exact opposite happens. The main reason is that Google has demonstrated great incompetence in all of its artificial intelligence product launches, and the disgrace experienced last week has put a damper on this series of failures. Google Chat first changed the name of Barn, which it developed as an answer to GPT, to Gemini, and then added the text-to-image conversion feature to Gemini. That's where it happened. Of course, people jumped on it immediately. They started experimenting and encountered very strange results.

For example, black or Far Eastern Nazi soldiers, for example, a female pope, for example, the fact that America's founding fathers were black, are very strange results and at first it was laughed at, but then it started to be discussed that this could actually be a problem beyond the incompetence of Google's search engine. What happened at the Gemini launch points out that there are serious problems in the company's management and culture. The root of the problem seems to be that dei policies are taken to an extreme and dei policy advocates become too powerful within the company.

Dei policies; Diversity, equity and inclusion are very well-intentioned. In fact, there should be diversity in the company, that is, people should not be separated according to their color, sexual preference, religion or race. Let the company have people from all these different spectrums. Let them be given equal opportunities and the company should try harder to include people who are left on the margins. Fundamentally, it is a good idea, it protects the rights of minorities against racism, but it can also cause problems when taken to extremes.

For example, a lawsuit has been filed against Elon Musk's Space X company on this issue. There is an allegation that there are not enough minorities employed in the company. Elon Musk also says, "We are going to space, we are going to Mars. I need the best engineers in the world. I do not have such discrimination. I hire the best engineer from wherever he is, whoever he is, from whatever race he is. As a result, if the structure in the company does not meet your criteria, I can do it." there is nothing." says. So, the extreme that is missed here is that the company's policies come to the fore beyond the company's priorities of making a profit, growing the business, and developing its technology.

It is said that there is currently an internal team at Google regarding DEI policies, and it is said that hundreds of people work here, and that this team has an excessive say in all product designs and all outputs of the company and pushes whether DEI is followed or not. In other words, what happened last week is the reflection of DEI policies in the software and code, such as showing the Pope as a woman and showing Nazi soldiers as black. The truth is, this is not only the case with Google's artificial intelligence platforms, but also with the search engine. For example, when we write doctor in English, black doctors and Indian doctors start to stand out.

You may say that the results are like this because the distribution of doctors in the United States is different. No, it is not, I mean black doctors are not the majority in America. Indian doctors are not in the majority. In fact, most of these are stock photos, not real doctor photos. Google has obviously made a priority here, too, and I can understand that. The superiority of one race has always been emphasized; it makes sense to bring a balance to the opposite. But if a search engine overemphasizes these types of preferences, and if these preferences come to the fore on an even more dangerous platform such as artificial intelligence, the reliability of both that search engine and that artificial intelligence becomes problematic. This could deal a serious blow to Google's business model.

92% of the world's search engine market belongs to Google. This is where most of Google's value comes from. The overwhelming majority of its turnover comes from here. There is already a lot of competition on the search engine side here. On the other hand, if people start to lose their trust in search engines, and if it is thought that the search results indicate Google's political preferences, as Google not only highlights its political policies, but also some hidden political agendas, there may be a market loss on Google's search engine side, and a very serious one. If it drops from 92% to 90%, Google's market value will drop very sharply. Because people read this as a leading sign of a trend reversal, and if there is no search engine on Google, there is no revenue.

We see from the charts how this unfortunate product launch of Alphabet hit the stock hard, and it has been declining since the beginning of the year. When you go backwards in the graph, it just can't get back together. Every time there is a product launch, there is a GAP Down and a new disgrace pushes the stock even lower. Mistakes can always happen with new product launches. We encounter these in every company, but at Google they repeat themselves very often. What happened last is a really big scandal. In this case, investors expect the company to take harsh measures in this regard. No, it didn't happen that way.

Sundar Pichai, who has been the CEO of the company for many years, sent an e-mail to his employees and said rudely in the e-mail: "This is unacceptable, there is a problem in our software. We must start fixing it immediately. We must move forward immediately." People didn't expect this. Because investors see it this way. There is obviously a click within Google, and this click now reflects their political agenda on product design and they are very dominant within the company. In fact, some insider gossip is that these DEI executives attend almost every meeting and have a say in every decision.

What is even more interesting is that it is not easy for people to be fired from Google's management levels. One of the unfortunate ones, James Damore, says that he was fired because he voiced his complaints about this issue. We cannot design products anymore. There is nothing we think about other than the political agenda. This political agenda is shaped by dei and we do everything accordingly. Dei people are the most powerful people in the company. This is the hottest topic on Wall Street right now, and as an investor we want a company to be interested in business, not politics.

Yes, Tesla also has such problems, but I see now that what Elon Musk is trying to do there is correct. Because Elon Musk has been saying for a long time that organizations such as Google, Meta, and Twitter, before he bought them, were pushing their political agendas, generally Democrat agendas, and that therefore the users of these platforms were exposed to excessive political propaganda. "I'm trying to change Twitter in this direction," he says. So let's give Elon Musk credit for now.

But we also see him, for example, shifting too much towards the republican side. It negatively affects the stock. Because as an investor, we want our company to be interested in business, not politics. But in examples such as Google and Meta, the issue of these companies' interest in politics becomes even more important because it affects billions of people. Wall Street's expectation is that there will be some carnage at home. Some think CEO Sundar Pichai should go. I'm on that front, by the way. Everyone says he is a wonderful person, a good person, by the way. I have nothing to say about it. I don't know, but it's clear that he hasn't taken the company to a good place, and it's quite frustrating that he doesn't take the necessary radical measures on these issues.

So either the products will really get better, the launches will become more successful, and we'll say yes, Google had problems but they solved them, or it'll give us some, frankly, head-butts. What does it mean to give head? Someone has to bear the responsibilities for these failures. If the CEO doesn't make him pay for his irresponsibility for such failures, he too will leave. Look, Meta was in a lot of trouble last year. Maybe there are those who remember. Meta is overly invested in the metaverse issue. There was no turning back. The stock fell to $100. Mark Zuckerberg took over. He made an extremely harsh decimation in the company. He made the company productive again. The stock is worth around $500 today.

So sometimes CEOs need to step up and make some decisions. However, when we look at Google's example, I can honestly guess why the CEO did not make such radical decisions. Because their business is going well. They currently dominate 91.62% of the market in the search engine market. The share of Bing, which has recently made an attack with artificial intelligence, is 3.31%, and Duck Duck Go, one of my favorites, is 0.53%. Many new competitors are entering, but Google still has the upper hand here. Looking at myself, I am someone who uses artificial intelligence a lot, but still when we say search, we habitually go to Google and press Google. This makes Google incredible money.

Let's take a look at the company's balance sheet right away on Seeking Alpha. Its turnover in the last 12 months is 307 billion. He made a gross profit of 175 billion from here. Net remaining profit is 73 billion dollars. A year, 365 days, that is, roughly every 5 days, they make an additional net profit of 1 billion dollars. The search engine is actually the main source of income and therefore profit. Apart from this, Google has YouTube. There are cloud services. In cloud services, it is far behind its competitors in terms of both turnover and profitability. But ultimately, the company is a tremendously profitable company. Cash flow is amazing, balance sheet is incredible. That's why the CEO can stay there.

And if I'm not mistaken, the founders still own private shares in Google. The decision is up to them. In other words, it is not possible for the board of directors to fire the CEO by its own decision. However, it seems that this will be possible with the decision of the founding duo. But as long as this issue is not resolved, I think Google's stock will continue to be suppressed and will fall far behind the much faster growing companies in artificial intelligence. Of course, there are also issues that make Google attractive. For example, it is still a cheap stock.

When I compare it to its big competitors Meta, Microsoft, Amazon and Nvidia, valuation is D, growth is B, profitability is A+, Momentum is B+. Although it is behind its competitors, it is still a vibrant stock. Profitability revisions are generally upward. So the stock is not a weak stock at all. In fact, if we were just looking at the table, I think Meta and Google would probably be our favorites. When we look at the valuation, the price divided by earnings forward is 20 in Google, 24 in Meta, 35 in Microsoft, 42 in Amazon, 34 in Nvidia. Price divided by earnings in the last 12 months is 23 in Google, 32 in Meta, 32 in Microsoft. ta 37, Amazon 60, Nvidia 66. Price divided by earnings divided by growth is 0.88. Because there is a slowdown in growth in Google. Meta 0.45, Microsoft 1.63, Amazon didn't measure this, Nvidia 0.11. Nvidia still looks cheap by the way.

So it is not possible to call Google stock expensive. It is not possible to call the company a failure. They are incredibly profitable. But are these profits, these successes still a reward for the things that were done right in the past, and can this new political agenda-filled structuring of Google hinder future growth, and can artificial intelligence initiatives such as chat gpt and search engine initiatives such as perplexity take a share from Google? Because if there is a slight downward movement in Google's search engine share, we will have a lot of trouble.

When we look at it, there has actually been a slight decline since February 2023. It has increased from 93.37% to 91.47% today. Wall Street does not care about this for now. He looks worried. That's why the stock is not going up anyway. But if it falls below 90 or so, I may not want to be on the Google list that day. To sum up, I think Google is an incredibly successful company. The most successful company created in the Internet era. Such a profit model, such a cash flow model does not exist in any other company. I think they are far superior to Meta in this regard.

But I think it needs a CEO change, a change in management, or a drastic policy change. Wall Street wants your head. Wall Street wants results. If there is no result or head, it looks like the stock will continue to be suppressed. In this context, I myself exited Google shares. Of course, the stock can go up, it can go down. It depends on a lot of things, but I have one very basic principle. The most important point for me about a company is that it is well managed. I think Google is not run well right now. Both the disgrace with the recent product launches and the poor response of the top management and the board of directors have cooled things off between Google and me a bit. There are better games with artificial intelligence. There are other cheap players too. I'd rather invest in them.

The information, comments and recommendations contained herein are not within the scope of investment consultancy. Investment consultancy services are provided within the framework of the investment consultancy agreement to be signed between brokerage firms, portfolio management companies, banks that do not accept deposits and customers. The comments in this article are only my personal comments and these comments may not be appropriate for your financial situation and risk return. For this reason, investments should not be made based on the information and comments in my articles.