Good morning. Anat Ashkenazi, CFO of Alphabet, Google's parent company, is investing big in AI infrastructure, but supporting other bets, like autonomous vehicle development, is also on her agenda.
In a fireside chat during the Morgan Stanley Technology, Media and Telecom Conference on Tuesday, Ashkenazi discussed Waymo, an Alphabet company that develops self-driving technology and ride-hailing services. Waymo is run by co-CEOs Tekedra Mawakana and Dmitri Dolgov.
“What's actually happening is an increase in investments that goes towards Waymo,” Ashkenazi said. The company is making strategic choices within its “Other Bets” category, which includes Waymo, she said.
“We have a tremendous opportunity here—phenomenal autonomous vehicles that can be used in a variety of ways,” Ashkenazi said. “So scaling that up rapidly, getting to more markets, getting more vehicles, is critical.”
She added: “I do think Waymo is a really, really interesting opportunity…It could be the future of transportation.”
As of Tuesday, Austin riders can now be matched with a Waymo autonomous vehicle on the Uber app. Alphabet CEO Sundar Pichai said in an X post on Feb. 27, that Waymo is serving more than 200,000 paid robotaxi rides each week, based on operations in Los Angeles, San Francisco, and Phoenix. Now that Austin is on the map, Atlanta and Miami are set to be the next cities.
Waymo had its first public trials of autonomous vehicles in Phoenix in 2017 and rolled out a full commercial service in 2018, Fortune reported. The startup raised $5.6 billion from investors in October, its largest-ever funding round. It was led by Alphabet, with continued participation from Andreessen Horowitz, Fidelity, Perry Creek, Silver Lake, Tiger Global, and T. Rowe Price.
Waymo has also raised outside investment in 2020 ($2.25 billion) and in 2021 ($2.5 billion). As of October, it is valued at over $45 billion, Bloomberg reported.
Last July, Alphabet (No. 8 in the Fortune 500) pledged to invest $5 billion over several years to help the startup build its autonomous driving technology. Waymo hasn’t yet reached profitability.
Pichai has referred to Waymo as the “clear technical leader within the autonomous vehicle industry.” During Alphabet's earnings call on Feb. 4, he said the company is developing a sixth-generation Waymo driver, which will “significantly lower hardware costs."
However, some consumers haven't yet warmed up to autonomous vehicles. Just 25% of Americans would prefer a robo-taxi to traditional rideshare, according to a study by JW Surety Bonds released in January, Fortune reported. And Waymo has had some glitches. A customer recently told Fortune his self-driving taxi drove him around in circles.
During Tuesday’s discussion, Ashkenazi also mentioned Alphabet subsidiary Isomorphic Labs, an AI-powered drug discovery firm, is also one of the company’s other bets. “Isomorphic has two large partnerships, one with Lilly, one with Novartis,” she said. Ashkenazi, who joined Alphabet in July, is the former CFO of pharmaceutical giant Eli Lilly and Company.
She’s often asked, “Why did you move from a very iconic health care company to another company?” Ashkenazi said on Tuesday. “And I think about it as really an opportunity to serve as CFO of probably two of the most impressive American companies,” she said.
Sheryl Estrada
sheryl.estrada@fortune.com
