Alphabet Tops $100 Billion Quarter as AI Drives Surge

Alphabet Tops $100 Billion Quarter as AI Drives Surge

Google parent company Alphabet has reported its first-ever $100 billion quarter, marking a historic milestone driven by booming demand for artificial intelligence and steady growth across its core businesses.

Revenues jumped 16 percent year-on-year to $102.3 billion in the third quarter, surpassing analyst forecasts and underlining the tech giant’s resilience in a highly competitive market.

“Alphabet had a terrific quarter, with double-digit growth across every major part of our business,” said CEO Sundar Pichai.

Net income rose 33 percent to $35 billion, as Alphabet continued to capitalise on the global AI boom reshaping the technology industry.

Google’s core search and advertising operations remained its biggest revenue generator, contributing $56.6 billion—up from $49.4 billion a year earlier. YouTube advertising revenues also climbed to $10.3 billion from $8.9 billion.

However, Google Cloud was the standout performer, posting a 34 percent jump to $15.2 billion. Competing with Amazon Web Services and Microsoft Azure, the division has emerged as a vital growth engine for the company.

Pichai credited Alphabet’s rapid AI rollout for the strong performance, citing global adoption of Gemini AI models and AI-powered features in Google Search. The Gemini App now has over 650 million monthly active users, with rising engagement through its AI Mode.

The strong quarter was tempered slightly by a $3.5 billion fine from the European Commission over alleged antitrust violations in its advertising technology business. Excluding the penalty, operating income would have increased 22 percent instead of the reported nine percent.

Alphabet is also ramping up capital expenditure to support its AI ambitions, forecasting 2025 spending between $91 billion and $93 billion—mostly directed toward expanding data centres and computing capacity.

Other tech giants, including Microsoft and Meta, have reported similar surges in AI-related spending, reflecting growing pressure on energy grids and water resources as demand for advanced computing rises.

Alphabet reported more than 300 million paid subscriptions across services such as Google One and YouTube Premium.

Despite overall strength, the company’s “Other Bets” segment—which includes autonomous vehicle developer Waymo—recorded a $1.4 billion loss on revenues of $344 million.

Alphabet’s share price has jumped nearly 40 percent this quarter, boosted by its financial results and a recent court decision rejecting a US government request to break up its Chrome browser business.

Analysts say the ruling, coupled with rising competition from AI-powered platforms like ChatGPT and Perplexity, underscores a shifting landscape in global search and digital advertising—one that Alphabet appears well-positioned to navigate.