Alphabet’s third-quarter earnings exceeded expectations, propelling its shares up by 6% in after-hours trading. The tech giant’s impressive performance was fueled by robust growth in its cloud division, which reported $11.35 billion in revenue—a significant 35% increase from the previous year. This surge is largely attributed to the company’s expanding artificial intelligence offerings for enterprise customers.
The company’s overall revenue hit $88.27 billion, surpassing forecasts of $86.30 billion. Earnings per share were reported at $2.12, beating the expected $1.85. Alphabet’s net income rose to $26.3 billion from $19.7 billion the previous year.
Google’s search business remained a strong contributor, generating $49.4 billion in revenue, marking a 12.3% year-over-year increase. Advertising revenue also saw growth, reaching $65.85 billion.
Alphabet’s Chief Financial Officer, Anat Ashkenazi, highlighted ongoing efforts to use AI for cost-cutting, optimizing workflow, and managing resources. The company is evaluating potential areas to accelerate growth and allocate capital efficiently.
YouTube’s advertising revenue slightly surpassed expectations, despite facing competition from platforms like Netflix and TikTok. AI improvements have enhanced YouTube’s recommendation systems, offering more personalized content to users.
Additionally, Alphabet’s “Other Bets” segment, which includes ventures like Verily and Waymo, reported $388 million in revenue, up from $297 million a year ago. Waymo recently closed a $5.6 billion funding round to expand its robotaxi services.
CEO Sundar Pichai emphasized the importance of AI in driving growth and innovation across Google’s product offerings. As the company continues to integrate AI at scale, it positions itself for sustained success in the competitive tech landscape.
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