Alphabet investors have very publicly anxious that the corporate’s massive AI spending isn’t definitely worth the money. With the corporate’s latest earnings report, those investors should have the opportunity to loosen up slightly.
The takeaway: Google’s cloud business — driven largely by enterprise AI adoption — is booming. The search giant saw Google Cloud revenue spike 82% from where it was this time last 12 months, climbing to $24.8 billion. That’s well above last quarter’s generous year-over-year growth, which showed a revenue jump of 63% to $20 billion — and it handily beats what Wall Street analysts expected for this quarter’s growth (the expectation was $22.46 billion).
Those cloud gains were driven largely by enterprise AI solutions and enterprise AI infrastructure adoption, the corporate said, while also noting that its backlog of cloud contracting work — that’s, work that it hasn’t yet converted into revenue — had climbed to $514 billion.
The corporate’s profit hit $112.1 billion, which is a large jump from this time last 12 months, when the corporate reported $28.1 billion in profit, the corporate’s earnings report shows. Meanwhile, Alphabet’s overall revenue grew 24% year-over-year in the course of the past quarter to $119.8 billion. The corporate also saw Google Services revenue jump 15% to $94.5 billion.
“Our AI investments are redefining what’s possible across every a part of our business,” said Google CEO Sundar Pichai during Wednesday’s earnings call. “We now have exciting momentum across the board.”
More individuals are also adopting Gemini, Google’s AI chatbot, because the app currently enjoys 950 million monthly energetic users, the corporate said. In Q4 of 2025, Google reported that the app had 750 million users.
It’s price noting that spiking revenue isn’t unusual for Google. This marks the corporate’s twelfth consecutive quarter of double-digit revenue growth. But even by that standard, this quarter represents a very bountiful period for the tech giant.
Alphabet’s spending remains to be hefty, with its capital expenditures — the cash it spends constructing data centers, buying chips, and expanding infrastructure — estimated to be between $180 billion and $190 billion for the 12 months — a fact not lost on analysts during Wednesday’s earnings call. Several pressed Pichai on when, and the way much, those investments pays off.
“I believe our compute capability investments in ’27,” he said. “We’re seeing strong demand indicators, including long-term deals,” he continued. “I believe, if anything, the dynamics look healthier than where we were a few 12 months ago, in order that’s what gives us the arrogance to undertake those investments,” he said.
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