Topline
Alphabet on Wednesday reported its 12th-straight quarter of double-digit revenue growth, boosted by another surge in Google Cloud sales as nearly 1 billion people now use the firm’s AI models.
Key Facts
Alphabet reported second-quarter revenue of $119.8 billion, an annual increase of 24%, surpassing Wall Street’s projections of $117 billion, according to FactSet.
The Google parent posted $9.11 earnings per share in what it called a year-over-year surge of 295%—the figure marked a roughly 291% annual increase and smashed consensus analyst estimates of $2.88 earnings per share.
Google Cloud revenue surged 82% to $24.8 billion, above estimates of $22.4 billion, as operating income from the segment more than tripled to $8.8 billion, driven by demand for AI products and infrastructure, Alphabet reported.
Alphabet CEO Sundar Pichai said in a statement the company’s Gemini has 950 million monthly active users, up from the 750 million it reported for Q4 2025.
Shares of Alphabet fell around 3% following its earnings report, but Deepwater Asset Management analyst Gene Munster suggested shares could rise on Thursday, citing the jump in Google Cloud revenue as the “most important number and it was a massive beat.”
what to watch for
How Alphabet’s spending compares to its mega-cap competitors. The company reported $44.9 billion in capital expenditures through its latest quarter, doubling its figure last year. Earlier estimates from Amazon, Alphabet, Microsoft and Meta indicated the firms would spend up to $750 billion this year as each worked to match growing demand for AI products.
big number
$97.8 billion. That’s how much Alphabet earned from “other income,” up from just $2.2 billion last year. Alphabet said the bump largely came from its equity securities, which include investments in Anthropic and SpaceX.
key background
Alphabet’s three years of quarterly revenue growth reflect the tech giant’s aggressive pivot toward AI. The Google parent has committed hundreds of billions of dollars to build data centers and other AI projects, and the firm reportedly has plans to develop a new in-house AI chip that Google engineers expect to be up to 10 times more energy-efficient than its predecessor. Pichai said Alphabet’s AI investments are “redefining what’s possible across every part of our business,” noting its “full-stack approach to AI delivering real, measurable value” to consumers.