FNMA Fannie Mae (QB)

DAVOS, Switzerland—Google parent Alphabet Inc. is focusing on creating long-term value rather than on incremental results, the company's chief financial officer said Thursday, adding strong internal controls and infrastructure that improves visibility are fundamental in today's tumultuous global markets.

Ruth Porat, who joined the Silicon Valley giant as CFO last May from Morgan Stanley, said that the $480-billion company sees itself as in the early stages of a revolution in how people use devices and interact in a connected world. The result: she has spent the 2016 focused on long-term capital allocation for the company's collection of businesses, from health care to self-driving cars, that it internally calls "bets."

"If we're not constantly pushing the frontier, we are not creating value for the long term," Ms. Porat said during The Wall Street Journal's CFO Breakfast at the World Economic Forum in Davos on Thursday. "If you're not disrupting your own business, somebody else will disrupt your business."

Ms. Porat, who was involved in advising Fannie Mae and Freddie Mac during the 2008 financial crisis, also said that she has taken a lesson from those times with her to the West Coast: Companies must build infrastructure that allows them to see what is going on throughout their businesses.

"You would not get into a car and drive 100 miles an hour with mud on your windshield," Ms. Porat said. "That is the lesson, particularly in businesses moving as rapidly as tech."

Ms. Porat's comments underscore her role in adding clarity to the former Google, melding experience from the banking world with the resources and vision of Silicon Valley, since joining the company some eight months ago. Shareholders have cheered the firm's push for more transparency, with the stock rising sharply since its decision to turn itself into a holding company that includes former namesake Google as well as other firms.

Ms. Porat said Thursday that she believed that the different units of Alphabet nevertheless belong together, because they can share resources, computing power and capital. She also said she doesn't expect to see Google's video site YouTube separated from Google to become its own "bet" within Alphabet.

"Our view is that there's a really strong interrelationship between all these businesses. They all benefit from one core infrastructure," she said.

On stage Thursday, Ms. Porat was also joined by Hugh Johnston, PepsiCo Inc.'s CFO, who said that his company also focuses on disruptive business ideas over the long term, despite being in the business of selling beverages and snacks.

Among PepsiCo's bets is investing in direct to consumer e-commerce in China. Another idea: personalized drinks based on information gleaned from a consumer's own sweat.

"I can design a Gatorade that's perfect for you," Mr. Johnston said. "I think lots more of our products will be much more personalized than before."

Write to Sam Schechner at sam.schechner@wsj.com

(END) Dow Jones Newswires

January 21, 2016 06:25 ET (11:25 GMT)

Grafico Azioni Fannie Mae (QB) (USOTC:FNMA)
Storico
Da Mar 2024 a Apr 2024

Grafico Azioni Fannie Mae (QB) (USOTC:FNMA)
Storico
Da Apr 2023 a Apr 2024