Alphabet posted a record $112.1 billion in quarterly profit on Wednesday, driven by booming demand for artificial intelligence and strong growth in its cloud business.
The Google parent reported $119.8 billion in revenue for the second quarter of 2026, up 24% year-on-year, making it the strongest quarterly financial performance in the company’s 27-year history.
Google Cloud emerged as one of Alphabet’s biggest growth drivers, with revenue rising 82% year-on-year to $24.77 billion, surpassing Wall Street’s estimate of $24.56 billion and significantly exceeding the $13.6 billion reported during the same period last year.
Advertising remained Alphabet’s largest source of revenue, generating $81.63 billion during the quarter, while the company’s AI-powered products continued to expand their user base.
Commenting on the results, Google Chief Executive Officer Sundar Pichai said the company’s AI strategy was delivering measurable value across its businesses.
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“Q2 was an amazing quarter, with Alphabet revenues growing 24% year over year and Google Cloud revenues accelerating to 82% growth, driven by demand for AI infrastructure and AI solutions,” Pichai said.
He added that Google’s core businesses including Search, YouTube and the Gemini AI application continued to perform strongly, with Gemini reaching 950 million monthly active users.
A significant share of Alphabet’s record earnings came from investment gains. According to the company’s earnings report, it recorded $99 billion in realised and unrealised gains from equity securities during the quarter, contributing approximately $77.1 billion to net income after taxes.
The gains were largely driven by Alphabet’s investments in Anthropic and SpaceX, both of which recorded sharp increases in valuation during the quarter.
SpaceX, in which Alphabet held an estimated 6% stake at the end of 2025, went public in early June with a valuation of $1.77 trillion, compared with $400 billion a year earlier. Meanwhile, Anthropic’s valuation climbed from $350 billion to $965 billion over the same period.
Alphabet’s investment in Anthropic began in April 2023 with an initial $300 million investment and has since grown to $13.3 billion, alongside commitments of up to $30 billion in additional funding.
As part of the partnership, Anthropic has committed to purchasing at least five gigawatts of computing capacity from Google Cloud, helping fuel the rapid expansion of the company’s cloud business.
Despite the record earnings, Alphabet raised its projected capital expenditure for 2026 to between $195 billion and $205 billion, up from its previous forecast of $180 billion to $190 billion, reflecting continued investment in AI infrastructure.
The latest results underscore Alphabet’s aggressive push into artificial intelligence, with the company betting that continued investment in AI, cloud computing and strategic partnerships will drive long-term growth.
