Google parent company Alphabet Inc. posted stronger-than-expected results for its second quarter, a sign that it's massive artificial intelligence spending spree is paying off so far and advertising revenue is coming in strong.
The Mountain View, California-based company said Wednesday it earned $112.11 billion, or $9.11 per share, in the April-June period. That's up from $28.2 billion, or $2.31 per share, in the same period a year earlier.
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Revenue grew 24% to $119.8 billion from $96.43 billion.
Analysts, on average, were expecting revenue of $117.06 billion, according to a poll by FactSet. Google did not disclose an adjusted earnings figure that's comparable to analysts' expectations, which was $2.88 per share. Google saw a net gain of $98 billion, mainly as a result of gains on its equity investments — mostly in SpaceX, which went public in June.
“Our AI investments are redefining what’s possible across every part of our business,” said CEO Sundar Pichai in a statement.
Emarketer analyst Nate Elliott called the results “impressive,” especially in regards to AI.
“On the consumer side, Gemini is now within a whisker of becoming Google’s third different 1 billion-user consumer AI product, alongside AI Overviews and AI Mode,” he said. "On the enterprise side, AI demand is driving enormous growth in the cloud business. And continued strong growth in search advertising backs up Google’s claim that AI is additive to search, not a replacement.”
As usual, digital ads fueled by Google’s dominant search engine propelled the quarter's revenue growth, boosted by World Cup advertising, especially on YouTube.
The tech giant also saw strong growth in its cloud business, boosted by its AI portfolio consisting of chips, models, data, security, and agent platforms.
Alphabet's shares climbed $2.71 to $344.62 in after-hours trading.
