After rejoining Google from Alphabet, Nest’s revenue and loss are exposed in the quarterly financial report. According to the latest finance report from Alphabet, Nest generated US$726 million in revenue in 2017, and incurred an operating loss of US$621 million.
The smart home brand generated US$278 million in revenue during the holiday season last year, which is almost the same amount in all of 2015, as reported by Recode.
Considering that Nest was bought by Google for more than US$3 billion in 2014, the company hasn’t been able to produce US$1 billion in sales and isn’t becoming profitable on an operating basis.
For the past year, Nest focused on expanding its product portfolio in the smart home market. The company introduced a home security system, a smart doorbell, and a affordable version of its flagship learning thermostat.
In order to gather focused fire in the smart home market and against Amazon, Google announced to bring the Nest back under its umbrella. Since then, Nest’s products are expecting to receive deeper integration with Google Assistant and Google Home. And the company will access more artificial intelligence resources from the search engine giant.
Nest sold more devices during the year than the previous two years combined, said Sundar Pichai, the CEO of Google, at the earnings call.
Alphabet and Google generates most of revenue from advertising, which brought about US$31.1 billion in sales at the first quarter of 2018. It might not be a big problem for the company that Nest isn’t making much money.
On the other side, Amazon’s sales number of Echo devices and other smart home gadgets hasn’t officially been revealed by the company.
Nest’s revenue number was calculated from the difference between Alphabet’s “Other bet” last year and Google’s “Other revenue” this quarter. The first quarter of 2018 was the first report which included Nest into Google’s financial numbers after rejoining the company.