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The numbers $102.3 billion: Alphabet’s Q3 revenue, up 16% year-over-year. $87.1 billion: Revenue generated by Google Services during the quarter, which includes Google Search, subscriptions, platforms, devices, and YouTube ads. $15.2 billion: Google Cloud revenues, up 34% from the same period last year. $2.87: Earnings per share, up 35% year-over-year. 650 million: Gemini monthly active users $91-$93 billion: Projected capital expenditures for 2025. The watercooler talk This is the first time in Google’s 27-year history that it’s generated over $100 billion in a single quarter. The momentum has largely come from the tech giant’s investments in AI infrastructure and applications. During the third quarter, the company expanded its LLM-powered Search experiences, AI Overviews, and AI Mode to global markets. It’s also been experimenting with the integration of advertising within those products since the spring, as well as commerce tools that let consumers shop directly within AI Mode. Overall search queries and queries with commercial intent continue to grow year-over-year, thanks in part to growing adoption of these AI search experiences, CEO Sundar Pichai said on a call with investors Wednesday evening. “AI Overviews drive meaningful query growth. This effect was even stronger in Q3 as users continue to learn that Google can answer more of their questions, and it’s particularly encouraging to see the effect was more pronounced with younger people,” he said. Pichai added that AI Mode, which now has over 75 million daily active users across markets, is “driving incremental total query growth for Search.” Gemini, the company’s family of foundation models, meanwhile, is gaining increased adoption, now with over 650 million monthly active users. Queries were up threefold since Q2. The company’s contracts with Nvidia are helping to power Google’s accelerating demand for tensor processing units (TPUs) to power its broader AI development. “We are bringing AI to more people and developers than anyone else,” Pichai said. Across all of its AI products, Google is now processing more than 1.3 quadrillion monthly tokens, representing a 20-fold year-over-year lift. Google Cloud was another especially bright spot during the quarter, bolstering topline performance with 34% growth since the same period last year. And in service of Google’s AI velocity, more than 70% of Google Cloud customers today use Google AI products, the company said. YouTube, for its part, continues to be a moneymaker for Google. The video sharing platform saw a 15% lift in advertising revenues during the quarter. YouTube is the most popular streaming platform in the U.S. market, per Nielsen data. The introduction of live NFL programming to YouTube last month is likely to bolster the business further. The positive results saw shares of Google trading up over 6% in after-hours trading today. The news arrives just two weeks ahead of closing arguments in the U.S. Justice Department’s case against the online search behemoth’s adtech business, which in April was found to be in violation of federal competition law. A federal judge is expected to dole out remedies to address Google’s illegal monopoly in ad exchanges and publisher ad servers in the coming months. Last month, the company was slapped with penalties in a different federal antitrust case concerning Google’s dominance in online search. Moving forward, Google will no longer be able to ink exclusive contracts for Search, Chrome, Google Assistant or Gemini. The key quote “We delivered our first ever $100 billion quarter,” said Pichai. “Five years ago, our quarterly revenue was at $50 billion. Our revenue number has doubled since then, and we are firmly in the generative AI era. In parallel, we’ve built for the long term and diversified with successful businesses in cloud, YouTube and subscriptions. Our momentum is strong, and we are shipping at speed.”
