For several years, a team inside X—the secretive research lab within Alphabet, Google’s parent company—has been working on a gadget to give people augmented-hearing abilities that would let them listen to select voices in a crowd. Recently, though, X told the team that they would no longer be pursuing the project, known as Wolverine, inside the company and that it would have to fend for itself as an independent business, according to a person with direct knowledge of the matter. Jason Rugolo, an executive leading the effort, left Alphabet this month.

Alphabet’s plan to spin out Wolverine, which hasn't been reported before, is another sign of the tougher stance Alphabet has taken in recent years toward spending under Ruth Porat, chief financial officer. In her six years at the company, Porat has created a more rigorous process for deciding how quickly to make big investments in new hardware for cloud computing, search and other needs. And under her watch, Alphabet has sought to rein in the excesses of free-spending engineers, including by killing projects that don’t look like they’re going anywhere.