Alphabet Today
$387.66 -9.28 (-2.34%) As of 05/19/2026 04:00 PM Eastern
- 52-Week Range
- $162.00
▼
$408.61 - Dividend Yield
- 0.22%
- P/E Ratio
- 29.57
- Price Target
- $411.23
Alphabet NASDAQ: GOOGL, the world’s second-largest public company, once again delivered a standout earnings report, all but reinforcing its dominance across search, cloud, and artificial intelligence.
The tech giant reported its fourth-quarter and full-year 2025 results after the close on Wednesday, Feb. 4, topping expectations across the board and surpassing a significant milestone: more than $400 billion in annual revenue for the first time in company history.
Shares initially traded lower in after-hours trading, dipping as much as 6% as investors reacted to Alphabet’s aggressive capital expenditure outlook for 2026. That move, however, proved short-lived. By the end of extended trading, shares were down just 0.39% as the market digested the strength of the underlying results and the company’s long-term growth investments.
Overall, the earnings report highlighted Alphabet’s continued execution across its core businesses, accelerating momentum in cloud computing, and rapid expansion of AI adoption across its ecosystem.
Alphabet Tops EPS and Revenue Estimates
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For the third consecutive quarter, Alphabet exceeded both earnings and revenue expectations.
The company reported earnings per share of $2.82, comfortably ahead of consensus estimates of $2.59. Revenue came in at $113.83 billion, beating forecasts of $111.43 billion.
For the full year, Alphabet generated $402.8 billion in revenue and $10.81 in earnings per share (EPS), reflecting year-over-year (YOY) growth of 17% and 34%. These figures underscore the company’s ability to scale profitably even as it invests heavily in next-generation technologies.
Google Cloud once again stood out as a primary growth driver. Fourth-quarter cloud revenue reached $17.66 billion, up 48% year over year and well above estimates of $16.18 billion. On an annualized basis, Google Cloud surpassed a $70 billion revenue run rate.
Perhaps more importantly, demand visibility continues to strengthen. Alphabet reported that its cloud backlog surged 55% quarter over quarter to $240 billion, up from $155 billion in the September quarter. New enterprise customers during the period included Anthropic and Meta Platforms NASDAQ: META, further validating Google Cloud’s competitive positioning in the AI infrastructure race.
Search and YouTube Growth Stays Strong in Q4
Beyond cloud, Alphabet’s core advertising engine continues to grow at a healthy pace. Search revenue rose 17% YOY in the fourth quarter, demonstrating that concerns around AI disruption have yet to impact Google’s core business materially.
YouTube also delivered solid results. In 2025, YouTube generated more than $60 billion in revenue from advertising and subscriptions combined. Across YouTube, Google One, and other services, Alphabet now boasts 325 million paid consumer subscriptions, reinforcing the durability and diversification of its revenue streams.
On the AI front, Alphabet disclosed that Gemini now has more than 750 million monthly active users. Additionally, the company processes over 10 billion tokens per minute through direct API usage, highlighting rapid enterprise and developer adoption. These metrics help explain why Alphabet continues to prioritize AI investment so aggressively.
2026 Capex Outlook: Why Spending Is Surging
Despite the strong operating performance, Alphabet’s outlook for capital spending dominated investor attention. The company expects capital expenditures in 2026 to range between $175 billion and $185 billion.
During the earnings call, Chief Financial Officer Anat Ashkenazi explained that the increased investment will primarily support AI compute capacity for Google DeepMind, meet surging cloud customer demand, and fund strategic investments across Alphabet’s “Other Bets.” She also emphasized that capital spending will be directed toward improving user experience and driving higher advertiser returns across Google’s services.
While the size of the capex figure initially unsettled the market, it reflects the reality of competing at scale in AI and cloud infrastructure.
AI and Cloud Strategy: Alphabet Bets Big to Defend Leadership
Alphabet delivered another blowout quarter, executing across virtually every major business line. Cloud continues to scale rapidly, margins are expanding, search remains resilient, and YouTube provides steady, high-margin growth. Gemini’s adoption metrics further suggest that Alphabet’s AI strategy is gaining real dominance.
The only point of friction for investors was the size of the company’s capital expenditure outlook. However, for Alphabet, sustained leadership in AI, cloud, and digital advertising requires continued aggressive investment. The company is clearly betting that spending big today will allow it to win even bigger over the long term. So far, the returns on that strategy appear to be paying off.
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