Alphabet Hits $119.8bn in Revenue as Cloud AI Accelerates
Alphabet has reported consolidated revenues of US$119.8bn for the second quarter of 2026, marking a 24% increase year on year (23% in constant currency).
The performance represents the tech parent company's 12th consecutive quarter of double-digit revenue growth, underpinned by accelerating performance in cloud infrastructure and steady momentum across core search and digital advertising operations.
Consolidated operating income rose 30% for the period ended 30 June 2026, pushing operating margins up by two percentage points to 34%.
Net income available to common stockholders climbed 298%, while earnings per share grew 294% to US$9.11.
The surge in bottom-line profitability was significantly aided by other income, which reflected a net gain of US$98bn, primarily driven by net unrealised gains on equity securities.
Enterprise AI fuels cloud acceleration
The highlight of the quarter came from Google Cloud, where revenue growth accelerated sharply to 82%, reaching US$24.8bn. The division experienced heightened demand across Google Cloud Platform (GCP) services, specifically through enterprise AI solutions and enterprise AI infrastructure, alongside core GCP products.
Google Services also maintained sustained growth, increasing revenues by 15% to US$94.5bn. Within this segment, Google Search and other revenues grew 17%, while Google subscriptions, platforms and devices rose 15%. YouTube ad revenues recorded a 13% gain for the quarter.
Sundar Pichai, CEO of Google and Alphabet, notes: “Our AI investments are redefining what’s possible across every part of our business.
“Q2 was an amazing quarter, with Alphabet revenues growing 24% year-over-year and Google Cloud revenues accelerating to 82% growth, driven by demand for AI infrastructure and AI solutions. It’s great to see wide adoption of Gemini Enterprise, with nearly 90% of the Fortune 100 using it.
“We are seeing strong demand for our security solutions, and our new Gemini 3.5 Flash Cyber delivers highly cost-efficient performance at the frontier. And month over month, people turn to YouTube for major world events, with over 1.7 billion unique viewers watching World Cup-related videos during the FIFA World Cup 2026.
“These outstanding results show that our differentiated, full stack approach to AI is delivering real, measurable value for consumers, customers, and our partners globally.”
Operational metrics and platform scale
Beyond the quarterly numbers, Alphabet's cloud backlog reveals the scale of enterprise commitment building behind the growth. Google Cloud's backlog reached US$514bn, up more than US$50bn quarter on quarter, with more than half expected to convert to revenue within 24 months.
Enterprise adoption of Gemini has also accelerated, with nearly 90% of Fortune 100 companies now using Gemini Enterprise.
Token processing volume has climbed to 22 billion API tokens per minute from 16 billion the previous quarter, while daily active users of the Gemini App have tripled over the past year.
The investment behind this growth is substantial. Alphabet raised its full-year capital expenditure guidance to between US$195bn and US$205bn, up from US$180-190bn previously, as the company continues building out AI infrastructure and data centre capacity.
Speaking on the earnings call, Chief Financial Officer Anat Ashkenazi said Alphabet remains in "a supply-constrained environment," with strong demand from both external cloud customers and across the business.
