Alphabet’s (NASDAQ:GOOGL, NASDAQ:GOOG) self-delivery drone service, Wing, will launch in the Dallas area on Thursday. This will be the largest test program of its type in the US. Wing’s drones can carry roughly 2.6 pounds of goods and travel 65 miles per hour. Additionally, the drone is capable of making a round trip distance of 12 miles. While it’s not quite giving GOOG stock a boost on the day, it’s exciting for long-term investors.
Moreover, the company will partner with Walgreens (NASDAQ:WBA), Easyvet, Blue Bell Creameries and Texas Health to deliver over 100 items to customers. That ranges all the way from ice cream to pet medications, first aid kids and over-the-counter medications.
Wing is also testing in Virginia, Finland and Australia. And so far, over 200,000 deliveries have been made as of earlier this year.
Of course, this isn’t Alphabet’s first foray into transportation and delivery. The company’s well known for its autonomous driving unit, Waymo. In fact, the unit recently announced that it will be expanding its autonomous driving tests in San Francisco — one more reason for investors to keep an eye on Alphabet.
Furthermore, Alphabet’s not the only big tech company to get into drone deliveries. Between Alphabet’s new venture and Amazon (NASDAQ:AMZN), the latter has been the more well-known. According to Business Insider:
“Amazon plans a September launch for commercial tests of its drone delivery service in California and Texas, delivering items under 5 pounds. Ultimately, Amazon plans to operate 145 drone launch stations and deliver 500 million packages by drone a year, said the documents obtained by Insider.”
Interestingly, both companies are also planning for a 20-for-1 stock split this summer. Alphabet plans for its split to occur on July 15, which was announced when the company reported better-than-expected earnings. Because of the company’s high-quality balance sheet and strong growth estimates, GOOG stock has been a beacon of strength amid the recent stock market volatility.
So, does Wing really move the needle here in the short term? No, not exactly.
Because of the company’s size, almost any new business will take time to have a financial impact. However, the good news is that Alphabet continues to grow its portfolio of logistics solutions. Beyond Wing and Waymo — the latter of which includes autonomous trucking and taxi services — that portfolio includes Google Maps, Google Earth, Waze and Sidewalks Lab. In turn, these are all good things for both Alphabet and GOOG stock.
On the date of publication, Bret Kenwell did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell.
