Google Parent Alphabet Tops $400bn in Annual Revenue as AI and Cloud Drive Growth

5 February, 2026

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Alphabet, the parent company of Google, on Tuesday reported strong fourth-quarter and full-year results, underscoring how artificial intelligence and cloud computing are reshaping the economics of Big Tech.

The group said consolidated revenues rose 18 per cent to $113.8bn in the three months to December 31, 2025, while full-year revenues exceeded $400bn for the first time, marking a major milestone in the company’s history.

Growth was broad-based across the business. Google Services revenues increased 14 per cent to $95.9bn, led by 17 per cent growth in Google Search and other products, 17 per cent growth in subscriptions, platforms and devices, and a 9 per cent rise in YouTube advertising. Alphabet said YouTube’s combined advertising and subscription revenues surpassed $60bn for the full year.

The standout performer was Google Cloud, where quarterly revenues surged 48 per cent to $17.7bn, driven by strong demand for enterprise AI infrastructure, AI-powered solutions and core Google Cloud Platform products. Alphabet said Cloud exited 2025 with an annual revenue run rate above $70bn, reflecting growing adoption by large corporate customers.

Operating income rose 16 per cent year on year, with an operating margin of 31.6 per cent, despite a $2.1bn employee compensation charge related to Waymo. Net income increased 30 per cent, while earnings per share climbed 31 per cent to $2.82.

Chief executive Sundar Pichai highlighted the role of AI in driving growth across Alphabet’s businesses, saying:

It was a tremendous quarter for Alphabet and annual revenues exceeded $400 billion for the first time. The launch of Gemini 3 was a major milestone and we have great momentum. Our first party models, like Gemini, now process over 10 billion tokens per minute via direct API use by our customers, and the Gemini App has grown to over 750 million monthly active users. Search saw more usage than ever before, with AI continuing to drive an expansionary moment.

Pichai added that Alphabet is seeing strong traction across consumer and enterprise products, noting that the company now has more than 325 million paid subscriptions across its consumer services, led by Google One and YouTube Premium.

Looking ahead, Alphabet signalled a sharp increase in spending as it races to meet surging demand for AI services. The company said capital expenditure in 2026 is expected to range between $175bn and $185bn, reflecting heavy investment in data centres, computing infrastructure and AI platforms.

The scale of that commitment highlights the intensifying capital requirements of the AI boom, even as Alphabet continues to deliver robust revenue growth and expanding profits.