<p id="speakable-summary" class="wp-block-paragraph">Alphabet investors have <a rel="nofollow" href="https://www.cbsnews.com/news/ai-bubble-tech-selloff-investment-consumer-business-demand/">very publicly worried</a> that the company’s <a href="https://techcrunch.com/2026/06/01/alphabet-plans-to-raise-80-billion-to-pay-for-ai-buildout/">massive AI spending</a> isn’t worth the money. With the company’s latest earnings report, those investors should be able to relax a little.</p>
<p class="wp-block-paragraph">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 year, 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 also handily beats what Wall Street analysts expected for this quarter’s growth (the <a rel="nofollow" href="https://www.bloomberg.com/news/articles/2026-07-22/alphabet-posts-cloud-sales-beat-slight-miss-on-search-revenue">expectation was $22.46 billion</a>).</p>
<p class="wp-block-paragraph">Those cloud gains were driven largely by enterprise AI solutions and enterprise AI infrastructure adoption, the company said, while also noting that its backlog of cloud contracting work — that is work that it hasn’t yet converted into revenue — had climbed to $514 billion.</p>
<p class="wp-block-paragraph">The company’s profit hit $112.1 billion, which is a massive jump from this time last year, when the company reported $28.1 billion in profit, the company’s earnings report shows. Meanwhile, Alphabet’s overall revenue grew 24% year-over-year during the past quarter to $119.8 billion. The company also saw Google Services revenue jump 15% to $94.5 billion.</p>
<p class="wp-block-paragraph">“Our AI investments are redefining what’s possible across every part of our business,” said Google CEO Sundar Pichai during Wednesday’s earnings call. “We have exciting momentum across the board.”</p>
<p class="wp-block-paragraph">More people are also adopting Gemini, Google’s AI chatbot, as the app currently enjoys 950 million monthly active users, the company said. In Q4 of 2025, Google <a href="https://techcrunch.com/2026/02/04/googles-gemini-app-has-surpassed-750m-monthly-active-users/">reported that</a> the app had 750 million users. </p>
<p class="wp-block-paragraph">It’s worth noting that spiking revenue isn’t unusual for Google. This marks the company’s 12th consecutive quarter of double-digit revenue growth. But even by that standard, this quarter represents a particularly bountiful period for the tech giant.</p>
<p class="wp-block-paragraph">Alphabet’s spending is still hefty, with its capital expenditures — the money it spends building data centers, buying chips, and expanding infrastructure — estimated to be between $180 billion and $190 billion for the year — a fact not lost on analysts during Wednesday’s earnings call. Several pressed Pichai on when, and how much, those investments will pay off. </p>
<p class="wp-block-paragraph">“I think our compute capacity investments in ’27,” he said. “We are seeing strong demand indicators, including long-term deals,” he continued. “I think, if anything, the dynamics look healthier than where we were about a year ago, so that’s what gives us the confidence to undertake those investments,” he said.</p>
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