In a surprise and unexpected announcement, Google says that it will be completely restructuring its business, creating a new company called Alphabet, which will oversee Google and a number of other organizations previously run by Google.
The new Google will be slimmed down, with companies that Google currently owns that aren't related to Google's Internet-based products instead being owned by Alphabet. The move will also see Google CEO Larry Page becoming the new CEO of Alphabet, and Product Chief Sundar Pichai becoming CEO of Google.
"Our company is operating well today, but we think we can make it cleaner and more accountable," said Larry Page in a blog post. "So we are creating a new company, called Alphabet. I am really excited to be running Alphabet as CEO with help from my capable partner, Sergey [Brin], as President."
Examples of the companies to be run by Alphabet rather than Google include the Life Sciences division, which has been working on things like contact lenses that can detect glucose levels, as well as Calico Labs, a biotechnology company created by Google in 2013.
According to Google, the main reason for the restructure is to make clear the difference between Google's main businesses and its other projects and longer-term endeavors. Alphabet will also include Google's X Lab, which is known for creating things like Google Glass, as well as Wing, Google's drone delivery project.
The blog post also discusses Sundar Pichai's role as Google, saying that Pichai has exceeded expectations since stepping up as product chief in October 2014, making him the ideal candidate for CEO of Google.
As far as shares go, Alphabet Inc. will replace Google as the publicly traded company, with all Google shares converting into the same number of Alphabet shares along with all the same rights associated with these shares. Google, in turn, will become a subsidiary of Alphabet. Shares will continue to be traded on Nasdaq as GOOGL and GOOG.
The news of the financial restructuring drove Google, or Alphabet, shares up by 4 percent.
This story is still developing, and it will take some time to get used to the very unexpected changes. It is likely that we will find out more about what the restructuring means for Google and Google's companies in the coming days and weeks.