Alphabet reported a strong first quarter of 2026 with significant revenue acceleration driven by AI investments across its business segments, particularly in Google Cloud and Search. The company also saw substantial growth in net income and EPS, bolstered by a significant gain from non-marketable equity securities.
Consolidated Alphabet revenues increased 22% year-over-year to $109.9 billion, accelerating from 12% in the prior year's quarter.
positiveGoogle Cloud revenues accelerated significantly, growing 63% to $20.0 billion, driven by enterprise AI solutions and infrastructure.
positiveNet income increased 81% to $62.6 billion, and diluted EPS grew 82% to $5.11.
positiveOperating margin expanded by 2 percentage points to 36.1%, indicating improved profitability.
positiveThe company announced a 5% increase in its quarterly cash dividend to $0.22 per share.
positiveOther income (expense), net was a significant gain of $37.7 billion, primarily from unrealized gains on non-marketable equity securities, which contributed substantially to net income and EPS, indicating potential volatility in future results.
attentionGoogle Network revenues decreased 4% year-over-year to $7.0 billion, a decline from the prior year's quarter.
attentionOther Bets segment operating loss widened to $2.1 billion from $1.2 billion in the prior year's quarter.
attentionAlphabet-level activities (primarily AI R&D) expenses increased significantly to $5.4 billion from $3.0 billion in the prior year's quarter.
attentionMargin expansion indicates improving profitability and operational efficiency. Measured in basis points (bps): 100 bps = 1.0%.
| Segment | Current | Prior Yr | YoY | % Total | CC |
|---|---|---|---|---|---|
Google Services | N/A | — | — | — | +19.0% |
Google Cloud | N/A | — | — | — | — |
Other Bets | N/A | — | — | — | — |
| Total Revenue | $0.00M | — | — | 100.0% | — |
Segment performance shows business unit health and growth drivers. Constant currency (CC) removes FX impact for like-for-like comparison.
| Metric | Value | Period | Specificity | vs Prior |
|---|---|---|---|---|
| capex | 180-190 billion | FY2026 | tight_range | New |
| capex | significantly increase | FY2027 | directional | New |
5% · quarterly
$6.5 billion in U.S. bonds and €3 billion in European bonds · March · funded by debt offering proceeds
funded by debt offering proceeds
Net Debt to Adjusted EBITDA: 1x to 1.5x
funded by free cash flow and portfolio management proceeds
$1.8 billion · quarter end
$450 million · Q2 2026
$1.1 billion · through December 31, 2026
Special items are non-recurring events that may distort period-over-period comparisons. Analysts typically adjust for these when calculating normalized earnings.
2026 is off to a terrific start. Our AI investments and full stack approach are lighting up every part of the business.
Search had a strong quarter with AI experiences driving usage, queries at an all time high, and 19% revenue growth.
Google Cloud revenues grew 63% with backlog nearly doubling quarter on quarter to over $460 billion.
Commentary excerpts from earnings call transcripts provide management's perspective on performance, strategy, and outlook. Always review full transcripts for complete context.
Operational metrics provide insight into business drivers and customer engagement beyond traditional financial measures.