Alphabet creates XXVI Holdings Inc. through which it will separate “Other Bets” from Google and become direct owner of subsidiaries like Waymo and Verily
Google business to be legally separated from car, health units — Holding company name plays on Page's dream of Other Bets
Context & Ripple Effects
Two years after the 2016 experiments with division-specific stock at Verily, Alphabet is completing the legal plumbing behind its holding-company structure: XXVI Holdings Inc. will sit above both Google and the Other Bets, making Waymo and Verily direct subsidiaries rather than units inside Google. The name plays on Larry Page's original framing of the Other Bets as independent ventures.
The move matters because the Bets have been a widening drag: by late 2019 they were posting $154M in quarterly revenue against $1.3B in operating losses, and the gap persisted into 2020. Legal separation gives Alphabet options it did not have when everything sat inside one company.
First-order effects
- Waymo, Verily and the other Bets become direct subsidiaries of XXVI Holdings, so their finances, liabilities and equity are legally ring-fenced from the Google business.
Second-order effects
- With clean subsidiary boundaries, Alphabet can fund, value or eventually divest individual Bets without entangling Google — the persistent billion-dollar quarterly losses make that optionality the point of the exercise.
Third-order effects
- If the pattern holds, Alphabet operates less as a single conglomerate and more as a portfolio manager over separately ownable companies, able to bring in outside capital or spin off units while Google remains the cash engine.
The trend: Alphabet is converting its Other Bets from internal divisions into legally distinct subsidiaries, building the structure needed to value, fund or shed them independently of Google.