Alphabet Inc. reported an 81% spike in net income to $62.2 billion for the first quarter, as its cloud and AI businesses continued to expand quickly.
Revenue significantly increased 22% year-on-year to about $110 billion, beating many expectations.
Google‘s CEO Sundar Pichai stated AI is “lighting up every part of the business,” with enterprise AI tools and increasing demand for computing power driving growth.
Google Cloud has recorded a skyrocketing growth, generating $20 billion in revenue, up 63% from the same period last year, while its backlog increased to $460 billion.
Notably, the company is heavily investing in AI infrastructure, including data centers and custom chips like Tensor Processing Units (TPUs), with Google revising estimates for capital expenditures this year to $180 billion to $190 billion, up from $175 billion to $185 billion.
Google recently rolled out its eighth-generation TPUs and plans to start selling chips directly to customers, opening a new stream of revenue.
On Wednesday, chief financial officer Anat Ashkenazi, told investors, “These strong results reinforce our conviction to invest the capital required to continue to capture the AI opportunity.”
“We expect our 2027 capex to significantly increase compared to 2026,” Anat added.
Meanwhile, its AI model Gemini continues to strengthen Google’s position in the competitive AI market.
Search remains a core business, generating $60.4 billion in quarterly revenue, up 19%. AI-powered features such as “AI Mode” and “AI Overview” are reshaping user experience.
Following the earnings announcement, Alphabet shares spiked over 6% in after-hours trading, reflecting strong investor confidence in its AI-driven growth strategy.
