Alphabet stock ticks up 1% as sales beat estimates

Alphabet reported first-quarter revenue and profit above expectations, driven by strong performance in its cloud computing division.

The results offer early signs that its heavy investments in artificial intelligence infrastructure are beginning to yield results.

The parent company of Google said revenue excluding partner payouts reached $94.7 billion, surpassing analyst expectations of $91.6 billion.

Total revenue came in around $110 billion higher than the estimates of around $107 billion.

Net income rose to $62.6 billion, marking an 81% increase compared with the same period a year earlier.

The company also reported record annual sales of $403 billion in 2025, with full-year profits reaching approximately $132 billion.

The stock was up around 2% in extended trading on Wednesday after the results came out.

Cloud growth leads earnings beat

A key driver of the earnings outperformance was Google Cloud, which posted revenue of $20 billion, ahead of the $18.4 billion projected by analysts.

The cloud unit’s growth is closely watched by investors as a barometer of demand for AI infrastructure, particularly as companies ramp up spending on data centres and computing power to support advanced AI models.

Alphabet has been investing heavily in building out its infrastructure footprint, aiming to deploy large-scale data centres equipped with high-performance servers for both internal use and enterprise customers.

Within Alphabet’s broader business, advertising performance showed mixed results.

YouTube advertising revenue came in at $9.88 billion, slightly below estimates of $9.99 billion, while traffic acquisition costs were $15.22 billion, also just under expectations of $15.3 billion, according to StreetAccount data.

Despite these modest shortfalls, overall revenue strength was sufficient to offset weaker areas.