Alphabet Taps Eli Lilly Executive as New CFO Replacing Porat

(Bloomberg) — Alphabet Inc. named Eli Lilly & Co. executive Anat Ashkenazi as its new chief financial officer, replacing Ruth Porat who announced last year she planned to step down.

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Ashkenazi, 51, has served as CFO and executive vice president at the drug maker, where she worked for more than 23 years, Alphabet said in a filing Wednesday morning. Her new position is effective July 31.

Porat, 66, who took over as CFO for Google in 2015, oversaw the search giant’s transition into the current structure under Alphabet and has taken on a new role at the company as president and chief investment officer. She famously ushered in a period of greater fiscal discipline at Alphabet, oversaw growth of the cloud computing unit, which became profitable last year, and YouTube, now the most popular streaming service on television.

For the past year, she has overseen Alphabet’s investments in its Other Bets division, an eclectic collection of nascent businesses such as life sciences unit Verily and autonomous driving startup Waymo that the company is working to nudge toward profitability.

Ashkenazi, who served as Eli Lilly’s CFO since 2021, oversaw the finance chiefs of the commercial business as well as those for research and development and manufacturing and quality, and also led the corporate strategic planning team and business transformation office. During Ashkenazi’s time as CFO, Lilly launched Mounjaro and Zepbound, drugs for diabetes and weight-loss that have made it the most valuable pharmaceutical company in the world

Her move to Alphabet is “very tough to question despite the monster of a pharma (and consumer) play Lilly has become,” said Jared Holz, an analyst at Mizuho Group. The Alphabet CFO “gig is probably one of the best in corporate America.”

Alphabet shares were up less than 1% in premarket trading Wednesday in New York.

Ashkenazi steps into the role at a pivotal moment for Alphabet. The company, valued at more than $2 trillion, has reoriented its teams and focus around generative artificial intelligence, which can answer questions in a conversational tone based on people’s queries. But the computing power and costs associated with the technology is enormous. Ashkenazi will need to manage Alphabet’s books as the company continues to invest heavily in data centers and compete with other tech giants for talented employees.

Ashkenazi’s background in health care may also play a part in boosting Alphabet’s reputation in a sector with vast potential in generative AI, said Mandeep Singh, an analyst at Bloomberg Intelligence. She “could help expand Alphabet’s addressable market and help catalyze some of its moonshots,” Singh said, “given her background and the availability of data in health care as a generative AI application.”

Alphabet has been trying to revolutionize health care for years, with varied success. Recently, the company announced a slew of initiatives to deploy its AI models in the health care industry, including a tool that will help Fitbit users glean insights from their wearable devices. Last year, Google unveiled Med-PaLM, an AI model that has capably fielded medical questions. The announcements followed a broad shift in strategy for the company in 2021, in which it moved to embed health-care research and other functionality in its core products like search and YouTube, rather than starting new commercial services.

But the efforts have left some of its moonshot goals in health care, embodied by Alphabet units like Verily and the life-extension company Calico, to somewhat languish. Ashkenazi may play a vital role in re-prioritizing efforts that once made eye-catching headlines, such as the motion-stabilizing spoon to help people with movement disorders or the mosquito modification project that aimed to curb the spread of malaria.

Alphabet’s shares are up about 40% over the past year and the company reported quarterly profit that increased by more than half in the first quarter. It also announced its first cash dividend, a welcome sign to investors after months of heavy spending on AI.

(Updates with analyst comments and detail throughout)

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