Alphabet revenue jumps to $119.8 billion as Google Cloud growth accelerates

Alphabet delivered an exceptionally strong Q2 2026 performance, anchored by stellar momentum in Google Cloud's AI infrastructure business.

Today, after the market closed, Alphabet reported its Q2 2026 earnings. It was another strong quarter driven by rapid growth across Google Search, Cloud, and the Gemini ecosystem.

Alphabet reported revenue of $119.8 billion, up 24% from $96.4 billion during the same period last year. Operating income increased 30% to $40.8 billion, while the operating margin expanded from 32% to 34%.

Alphabet’s net income surged nearly 300% to $112.1 billion, with diluted earnings reaching $9.11 per share. However, most of this increase came from a $98 billion net gain due to unrealized gains on SpaceX equity.

Google Services remained Alphabet’s largest business, generating $94.5 billion in revenue, up 15%. Google Search and other advertising revenue grew 17% to $63.3 billion, while YouTube advertising revenue increased 13% to $11.1 billion. Google Network revenue declined slightly to $7.3 billion.

The star of the earnings call was Google's Cloud business. Google Cloud's revenue jumped 82% to $24.8 billion, driven by demand for AI infrastructure, enterprise AI solutions, and core Google Cloud Platform services. Additionally, the operating income of the Cloud business more than tripled from $2.8 billion to $8.8 billion, with an operating margin of 35.6%. Google also revealed that its Cloud backlog now stands at $514 billion, up from $490 billion.

Alphabet CEO Sundar Pichai commented during the earnings call that nearly 90% of Fortune 100 companies are now using Gemini Enterprise, and 90% of the Fortune 100 are Google Cloud Security users. Google’s first-party model APIs are processing approximately 22 billion tokens per minute, up from 16 billion in the previous quarter. The Gemini app has also reached 950 million monthly active users, with daily active users tripling over the last year.

Due to heavy investments in AI infrastructure, capital expenditure doubled year-over-year to $44.9 billion during the quarter, resulting in a negative free cash flow of $5.9 billion, a first for Alphabet/Google in nearly two decades.

Source

Hope you enjoyed this news post. Feedback welcome.

Posted Thursday 23 July 2026 at 6:08 pm AEST (my time).

News posts: 2023 5,800+ | 2024 5,700+ | 2025 5,700+ | 2026 (to end of June) 2,475

RIP Matrix