Google's John Mueller answered a geotargeting and hreflang question in the Google Webmaster Help forums, a topic I always find fascinating for some reason. The question was "can I geo-target for one country while leaving an other country not geo-targeted to serve the rest of the world?"
John said, yes you can do that. John then explains the difference between geotargeting and using hreflang, which is also very interesting. John said that with geotargeting, Google will promote the localized version to the local version of that Google search. With hreflang, he added, there is no promotion or demotion but rather Google will swap out the URLs with the appropriate URLs for the country and language.
Here is what John said to that question:
Yes, yes you can do that. Generally, what happens with geotargeting is that we promote the site (or part of the site -- it needs to be clearly separated through a subdomain or subdirectory) when users in that country search for local content. With hreflang there's no promotion or demotion involved, it just takes the rankings as they'd normally appear, and tries to swap out the URLs according the the best-matching hreflang version. With geotargeting, assuming it's a gTLD, you need to verify the section of the site in Search Console, and can then specify the country for that section. If you don't select anything, our systems will try to figure it out on their own. You can also select the checkbox, and then use "Unlisted" as a country to tell us that this section should not be geotargeted.
Such an interesting topic. Why? Well, I've never done any implementation of geotargeting or hreflang. I really should one day...
Forum discussion at Google Webmaster Help.