RBC's Mark Mahaney On Google's Reorganization: 'More Of A Modest Catalyst Than A Major Catalyst'

RBC Capital Market Internet analyst, Mark Mahaney, was on CNBC Tuesday to discuss Google Inc GOOGL's reorganization of its business into a new umbrella company Alphabet Inc. Here is what he said.

Indicates More Transparency

"We look at this as more of a modest catalyst than a major catalyst," Maheny began. "The market has wanted four things from Google, revenue growth, consistency, margin stabilization, cash back and greater transparency. What this move indicates is more transparency. And, I think, we are really going to find out just how much more profitable the core Google business is when you strip out all these moonshot investments. That's nice, it's not great, but it's nice."

Numbers The Company Should Think About Disclosing

Mahaney was asked what are the kind of metrics he wants Google to release. He replied, "What I would really like to see [here] more than anything else, just tell us what's happening to the core search business. What the market fears and, I think, mistakenly fears is that core search -- mobile and desktop together -- is well on its way and it's almost in single digit growth land, 8-9 percent year-over-year."

Mahaney continued, "We think, search is probably going like low to mid teens and it matters because the longer they can sustain that low to mid teen growth in its core advertising business which is so highly profitable [and] just gives it greater long-term growth opportunities. That kind of disclosure would be super."

"But if you can't give us that, how about telling us what YouTube revenues really are. There's a lot of estimates on the Street, we keep hearing these selective disclosures from the company that these numbers are too high or too low. Tell us what the real numbers are, we will do the rest from there," Mahaney said.