Highlights

  • Q4 revenue rose 18% YoY to $113.8 billion, surpassing analyst estimates.
  • Google Cloud revenue jumped 48%, with operating margin increasing to 30.1%.
  • Gemini Enterprise sold over 8 million paid seats, monthly users exceed 750 million.

Alphabet’s (NASDAQ:GOOGL) fourth-quarter revenue totaled $113.8 billion, marking an 18% increase year over year and 17% in constant currency. Operating margin remained steady at 32%, supporting a 31% rise in diluted earnings per share to $2.82. Analysts had forecast revenue of $111.48 billion and EPS of $2.64, indicating the company exceeded expectations.

Google search and advertising continue to be major revenue contributors. Search revenue rose 17% year over year, while YouTube grew 9%, bringing total ad revenue growth to 14%. These results helped alleviate concerns that AI-related initiatives could cannibalize advertising revenue.

Alphabet’s Google Cloud segment recorded $17.7 billion in revenue, reflecting a 48% year-over-year increase, up from 34% in the prior quarter. This growth surpasses Microsoft Azure’s 39% expansion, showing strong competitive momentum. Operating margins for the segment climbed to 30.1%, up from 23.7% in Q3, highlighting efficient resource utilization.

The company reported over 8 million paid Gemini Enterprise seats and more than 750 million monthly active users for the Gemini app, with engagement rising after the Gemini 3 update. Cloud and AI demand continues to exceed available capacity, driving plans for increased investment.

Capex to Nearly Double in 2026: Alphabet intends to nearly double its capital expenditures in 2026, projecting $175–180 billion, up from $91 billion in 2025, to support AI and cloud infrastructure. The company’s stock has gained 65% over the past year, trading at under 30 times forward earnings, reflecting investor confidence amid sustained cloud and AI expansion.