Investing.com — beat quarterly top-and-bottom line estimates, while forecasting capital expenditures for 2026 that blew past expectations.
Shares of the company were lower by more than 3% in early U.S. trading on Thursday.
Alphabet’s results come at a time when technology stocks and the artificial intelligence trade are under immense pressure. A heavy rotation out of software names due to the perceived impact of AI products on these companies, along with renewed concerns over elevated valuations and massive spending plans, has weighed on Wall Street.
The Google-parent, like its megacap rivals, has outlined heavy AI spending ambitions, setting aside billions of dollars for data centers and chips, and pouring money into AI models and platforms.
Alphabet said it expects to spend $175 billion to $185 billion in capital expenditures in 2026, up significantly from 2025. The Street estimate was $119.50 billion.
“There are only 59 other companies in the S&P 500 that Alphabet couldn’t buy with the $180 billion in CapEx it plans for this year,” Bespoke Investment Group noted on X (formerly Twitter).
The results also come at a time when Alphabet has been leading in terms of stock performance among its Magnificent 7 peers. Class A shares of the tech giant surged 65.3% in 2025, easily the best showing among the seven members of the club. GOOGL shares are up another 8.5% YTD, outstripping the other Mag 7 firms and the benchmark S&P 500 index.
The Google-parent’s class A shares spiked 28.8% in the last three months of 2025 alone, driven by a highly positive reaction to its newest Gemini AI model and a deal with to help power the iPhone-maker’s AI features, including its Siri voice assistant.
“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,” top boss Sundar Pichai said in a statement.
“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.
Turning to the company’s results, Alphabet earned $2.82 per share on revenue of $113.83 billion for Q4 2025. Analysts had been expecting a profit of $2.64 per share on revenue of $111.12 billion. For the tech behemoth, Q3 2025 had marked its first ever $100 billion quarter in revenue.
Alphabet’s quarterly operating income rose 16% Y/Y to $35.93 billion.
“Alphabet’s growth remains tremendous for a company their size, or any company for that matter. The are perfectly positioned to capitalize on the AI revolution and the surge of interest in this space across our planet,” Christopher Ballard, managing director at Check Capital Management, told Investing.com.
“They passed $400 billion of total revenues for the first time, and they announced plans to spend around $180 billion in 2026 to increase their chances to continue these colossal totals,” Ballard said.
With AI grabbing headlines, focus was on the Mag 7 member’s Google Cloud segment, the business that houses AI infrastructure and generative AI solutions. With a 48% Y/Y surge in revenue to $17.66 billion, Google Cloud reinforced its position as one of Alphabet’s fastest growing segments.
Despite all the attention on AI, Alphabet’s core Google Services business, which includes products and services such as ads, Android, Chrome, Google Maps, Search, and YouTube, continued to post solid growth. The segment brought in revenue of $95.86 billion, an increase of 14% Y/Y.
“Their growth in Google search increased 17% at a time when their critics have alluded to the notion that ‘search is dead’. There are strong indications that the AI prompts users input create more questions which lead to searches on Google’s browser, which in turn keeps advertisements and revenues growing. Google’s engine is truly a powerful one,” Ballard added.
Finally, Alphabet’s Other Bets segment brought in revenue of $370 million, down 7.5% Y/Y. Revenues in this segment are generated primarily from the sale of autonomous transportation services, healthcare-related services, and internet services.
Scott Kanowsky contributed reporting.