If you want to know whether the massive AI investments by Big Tech are paying off — Alphabet’s Q1 numbers give a pretty clear answer. Google’s parent company reported its quarterly earnings yesterday evening, and they’re impressive.
The Numbers
Alphabet reports $109.9 billion in revenue for Q1 2026 — up 22% year-over-year. Earnings per share came in at $5.11, nearly double the analyst expectation of $2.62. Net income reached $62.58 billion, compared to $34.54 billion a year ago.
Cloud Is the Star
The real headline is in the Cloud numbers. Google Cloud grew 63%, with a backlog that nearly doubled quarter-over-quarter to over $460 billion. And AI revenue within Cloud? Up 800% year-over-year. For the first time, enterprise AI solutions have become the primary growth driver for Google Cloud.
Search and YouTube
Google Search grew 19%, with queries at an all-time high — driven by AI-powered experiences. YouTube ad revenue came in at $9.9 billion (up 11%), but slightly missed Wall Street’s expectations.
What Sundar Pichai Says
CEO Pichai called Google ‘compute constrained’ — meaning limited by available processing power. Cloud revenue would have been even higher if they could meet demand. For 2027, he expects significantly higher capital expenditure than 2026.
That’s remarkable: the CEO of one of the world’s largest technology companies is saying he can’t spin up servers fast enough. It tells you where the industry stands right now.
Sources: CNBC, 9to5Google, Google Blog