Alphabet Q3 2026: revenue $127.6 billion, Google Cloud doubles to $30.7 billion
Google's parent grew revenue 25% and Cloud sales 103% in the third quarter, but an $8.2 billion non-operating loss cut profit to $26.2 billion and shares slid after hours.
At a glance
- Alphabet's revenue rose 25% to $127.6 billion in July–September 2026, its 13th straight quarter of double-digit growth.
- Google Cloud revenue more than doubled (up 103%) to $30.7 billion, and its operating profit tripled to $11.1 billion.
- Net income fell to $26.2 billion ($2.12 a share) from $35.0 billion ($2.87) a year earlier, after an $8.2 billion non-operating loss replaced a $12.8 billion gain.
- Capital spending more than doubled to $51.4 billion in the quarter as Alphabet builds AI data centres; the shares fell about 7% in early after-hours trading.
- CEO Sundar Pichai said the Gemini app has reached one billion users and Alphabet is now on a half-trillion-dollar annual revenue run rate.
Alphabet, the parent company of Google, reported on Wednesday, October 28, 2026, that its third-quarter revenue rose 25% to $127.6 billion, powered by a 103% jump in Google Cloud sales to $30.7 billion. But profit fell to $26.2 billion, or $2.12 a share, from $35.0 billion a year earlier because of a large non-operating loss, and the shares dropped about 7% in early after-hours trading as investors focused on the earnings shortfall and record AI spending.
The results in numbers
The quarter covers July to September 2026. Operating income — the profit from Alphabet's actual businesses — rose 30% to $40.6 billion, with an operating margin of 31.8%. The fall in net income came below that line: "other income and expense" swung from a $12.8 billion gain a year ago, largely from rises in the value of its investments, to an $8.2 billion loss this quarter.
| Item | Q3 2025 | Q3 2026 | Change |
|---|---|---|---|
| Total revenue | $102.3 bn | $127.6 bn | +25% |
| Operating income | $31.2 bn | $40.6 bn | +30% |
| Operating margin | 31% | 31.8% | — |
| Other income (expense) | +$12.8 bn | −$8.2 bn | — |
| Net income | $35.0 bn | $26.2 bn | −25% |
| Earnings per share | $2.87 | $2.12 | −26% |
| Capital expenditure | $24.0 bn | $51.4 bn | +114% |
| Employees | 190,167 | 204,757 | +8% |
Revenue by business
| Business | Q3 2025 | Q3 2026 |
|---|---|---|
| Google Search & other | $56.6 bn | $63.4 bn |
| YouTube ads | $10.3 bn | $11.2 bn |
| Google Network | $7.4 bn | $7.5 bn |
| Subscriptions, platforms & devices | $12.9 bn | $14.3 bn |
| Google Services total | $87.1 bn | $96.3 bn |
| Google Cloud | $15.2 bn | $30.7 bn |
| Other Bets | $0.34 bn | $0.37 bn |
Google Services grew 11%, with Search up 12%. Google Cloud's operating income jumped to $11.1 billion from $3.6 billion, making it a major profit engine for the first time. Other Bets, which includes Waymo, lost $2.0 billion, and Alphabet-level costs — mainly shared AI research — rose to $7.7 billion.
What the company said
Chief executive Sundar Pichai said Alphabet is "now on a half-trillion dollar revenue run rate". He said year-over-year growth in Search queries is the highest in five years, which he linked to AI features, and that cloud demand was "powered by huge demand" for AI infrastructure and Google's own TPU chips.
Pichai said the Gemini app has reached one billion users, calling it the fastest-growing product in Google's history, and that Google's first-party AI models now process nearly 32 billion tokens a minute, more than four times a year ago. YouTube Music and Premium passed 150 million subscribers, including trials.
Background: the AI spending race
Alphabet, Microsoft, Amazon and Meta are spending record sums on data centres and chips to train and run AI models. Alphabet's capital spending of $51.4 billion in a single quarter is more than double a year ago; in July it had raised its full-year forecast to $195–205 billion. To fund this, it issued $28.7 billion of bonds in the quarter and sold about $12.4 billion of new shares through an at-the-market programme.
Google Cloud has been the clearest sign that the spending is paying off: its growth accelerated from 82% in the second quarter to 103% now. Investors, however, have been nervous about the AI trade; the stock had fallen in five of the six sessions before the results and was down about 7% for October.
Market reaction
The report came after Wall Street closed higher on Wednesday following the Federal Reserve's decision to hold interest rates at 3.75%–4.00%. The S&P 500 gained 0.28% to 7,743.98, the Nasdaq rose 0.27% to 26,549.85 and the Dow added about 98 points to 52,475.10.
Earnings per share of $2.12 were well below the roughly $3 that analysts had forecast, and Services revenue was slightly short of expectations, while Cloud beat forecasts of about $29 billion. Alphabet shares fell about 7% in early after-hours trading. Microsoft, which reported at the same time, beat forecasts and its shares rose.
Why it matters
Alphabet is one of the world's most valuable companies and a big weight in the S&P 500 and Nasdaq, so its share price moves pension and savings funds worldwide. The doubling of Cloud revenue shows companies are paying heavily for AI computing — a trend that also drives demand for chips from Asian suppliers and for data-centre power. For advertisers and small businesses, including in Pakistan and South Asia, Google Search and YouTube remain the main digital ad platforms, and AI changes to search affect how much traffic websites receive.
What happens next
Alphabet will pay a quarterly dividend of $0.22 per share on December 14 to shareholders of record on December 7. Investors will watch Thursday's regular trading session for the full market reaction, and more of the largest US technology companies report their quarterly results in the coming days. Alphabet's fourth-quarter results are expected in late January or early February 2027, when it will also give an outlook for 2027 capital spending.
Questions people are asking
How much revenue did Alphabet make in Q3 2026?
Alphabet reported revenue of $127.6 billion for the quarter ended September 30, 2026, up 25% from $102.3 billion a year earlier. Net income was $26.2 billion, or $2.12 per share.
How fast is Google Cloud growing?
Google Cloud revenue rose 103% year on year to $30.7 billion in Q3 2026, driven by demand for AI infrastructure, AI services and Google's TPU chips. The unit's operating income rose to $11.1 billion from $3.6 billion.
Why did Alphabet stock fall after earnings?
Earnings per share of $2.12 were far below the roughly $3 analysts expected, mainly because of an $8.2 billion loss in other income, and Google Services revenue of $96.3 billion was slightly below forecasts. The shares fell about 7% in early after-hours trading.
