Alphabet Q3 Earnings Surpass Expectations with Strong Ad Revenue and Cloud Growth

Alphabet Inc. reported robust third-quarter earnings that exceeded Wall Street forecasts, as the tech giant’s core advertising revenue grew significantly, allaying concerns over potential threats from AI-driven competitors. Following the report, Alphabet’s stock surged over 5% in premarket trading on Wednesday.

For Q3, Alphabet recorded earnings of $2.12 per share, surpassing analysts’ projections of $1.84, while revenue reached $88.27 billion, above the expected $86.37 billion. This performance was largely driven by a solid 10% growth in advertising revenue, which rose to $65.85 billion from $59.65 billion in the same period last year. YouTube, a key component of Alphabet’s ad business, reported a notable increase in ad revenue, reaching $8.92 billion compared to $7.95 billion a year earlier.

Alphabet’s Google Cloud division also impressed, showing a 35% year-over-year revenue increase to $11.35 billion, outpacing consensus estimates. The strong growth in cloud revenue highlights Alphabet’s success in diversifying its revenue streams and competing with cloud market leaders.

With these strong results, Alphabet demonstrates resilience in its core ad business and growing strength in cloud computing, reinforcing investor confidence despite rising competition in the AI and search spaces.