Alphabet beat earnings and revenue expectations

Alphabet released its fourth-quarter earnings Wednesday. The search giant reported earnings per share of $2.82, beating the FactSet analyst consensus of $2.63. The Google parent’s revenue was $113.8 billion, compared with Wall Street’s expectation of $111.3 billion.

For comparison, Alphabet reported EPS of $2.15 and revenue of $96.47 billion in the fourth quarter of 2024.

The search giant reported full-year capital expenditure to be $91.4 billion, in line with its own expectations. However, the company’s 2026 capex is expected to be way higher than analysts thought: $175 billion to $185 billion, versus analysts’ $115.6 billion.

Let’s break down the results for Alphabet’s many divisions:

• 📺 YouTube’s Q4 ad revenue rose 9% to $11.4 billion.

• ☁️ Google Cloud revenue for the fourth quarter was $17.7 billion, rising 48% year over year.

• 🔎 Google’s Search business brought in $63.1 billion, up 17%.

• 💰 Google advertising revenue was $82.3 billion, a 14% increase year over year.

The search giant has been riding high following the widely praised release of Gemini 3 in November, as well as growing enthusiasm around its lucrative tensor processing unit semiconductor business. Prior to the earnings report, the stock was up more than 60% in the last 12 months.

“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,” Google said in its press release. “Search saw more usage than ever before, with AI continuing to drive an expansionary moment.”

Like with every other Big Tech company, investors will be looking for more details on how exactly AI is impacting its top and bottom lines — and how much it’s spending to get there.