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Sometimes, when titans of industry come out miraculously, shockingly, unexpectedly (!) on top, there’s a strange comfort to it.
Oh, Taylor Swift has another hit album? Tom Cruise starred in another blockbuster? James Patterson penned another New York Times bestseller? Cool, whatever, good for them.
It’s also how it feels when Alphabet reports strong earnings, which typically arrive with a solid side helping of “Woooow, shocker.”
But there’s an important update within the tech titan’s Q3 earnings report, which, yes, delivered top and bottom line beats: It was growth in the Google parent company’s cloud business that particularly buoyed earnings this quarter, and that’s what the AI-heads wanted to hear.
Alphabet posted cloud revenue of $11.4 billion, a 35% YoY jump. The steep climb was driven by “accelerated growth” across the company’s AI infrastructure and generative AI solutions, the company said in its earnings report.
“This business has real momentum and the overall opportunity is increasing as customers embrace GenAI,” CEO Sundar Pichai said on the company’s earnings call, adding that its AI portfolio is “helping us attract new customers.” He stressed that the company’s investment in AI is “paying off and driving success for the company.”
And, no shocker, the rest of the company’s earnings looked solid, too.
Alphabet posted $88.3 billion in revenue for the quarter, a 15% jump from last year. Advertising revenue came in at $65.9 billion, up from $59.6 billion in in Q3 2023. And YouTube ad revenue was up from $8 billion a year ago to $8.9 billion. Finally, Google’s all-important search business earned $49.4 billion in revenue, a 12.2% YoY jump.