Alphabet Inc., Google’s parent company, reported blockbuster fourth-quarter results on Feb. 4, 2026, surpassing Wall Street expectations and pushing full-year 2025 revenue above $400 billion for the first time in its history, fueled by surging demand for AI-powered products across Search, YouTube and Google Cloud.
The company posted consolidated revenue of $113.8 billion for the quarter ended Dec. 31, 2025, up 18% from $96.5 billion a year earlier (or 17% in constant currency). Earnings per share reached $2.82, a 31% increase, beating analyst estimates of $2.63 EPS and $111.3 billion in revenue, according to FactSet consensus.
For the full year, Alphabet generated $402.8 billion in revenue — up 15% from 2024 — marking the milestone first crossing of the $400 billion threshold. Net income rose 30% to approximately $34.5 billion for the quarter, with full-year figures reflecting strong profitability amid heavy AI investments.
CEO Sundar Pichai called it “a tremendous quarter for Alphabet,” highlighting the launch of Gemini 3 as a major milestone. “Annual revenues exceeded $400 billion for the first time,” he said on the earnings call. “We have great momentum. Our first-party models like Gemini now process over 10 billion tokens per minute via direct API use by customers, and the Gemini App has grown to over 750 million monthly active users.”
Search & other revenue accelerated with 17% growth, driven by AI enhancements expanding usage. YouTube crossed $60 billion in annual revenue across ads and subscriptions, with paid subscriptions across consumer services topping 325 million, led by Google One and YouTube Premium. Google Cloud revenue surged 48% to $17.7 billion in Q4, ending 2025 at an annual run rate over $70 billion, propelled by enterprise AI infrastructure, solutions and core GCP products.
The results underscore Alphabet’s dominance in the AI race. Operating income rose 16% to reflect a 31.6% margin, despite a $2.1 billion employee compensation charge for Waymo. Operating cash flow hit a record $52.4 billion in Q4.
Investors reacted mixed to the report. Shares initially rose on the beat but whipsawed after-hours as Alphabet guided to massive 2026 capital expenditures of $175 billion to $185 billion — nearly double 2025’s $91.4 billion — to scale AI compute and infrastructure. CFO Anat Ashkenazi noted supply constraints ahead, with Pichai acknowledging the year would be “supply constrained” to meet demand.
The hefty CapEx guidance — far above analyst expectations of around $115 billion — signals aggressive bets on data centers, TPUs, GPUs and other AI hardware. It follows similar moves by rivals like Meta, which projected $115-135 billion for 2026.
Analysts praised the acceleration but flagged risks from elevated spending. “They passed $400 billion of total revenues for the first time, and announced plans to spend around $180 billion in 2026 to increase their chances to continue these colossal totals,” said one analyst.
Google Services revenue climbed 14% to $95.9 billion, led by Search (17%), subscriptions/devices (17%) and YouTube ads (9%). The cloud segment’s 30.1% operating margin (up from 17.5%) reflected efficiency gains amid explosive growth.
The earnings come as Alphabet navigates antitrust scrutiny, AI competition and regulatory pressures. Yet the results affirm its AI strategy: Gemini adoption (over 8 million paid enterprise seats at 2,800+ companies), a $240 billion cloud backlog, and AI driving “expansionary” Search moments.
Pichai emphasized broad impact: “We’re seeing our AI investments and infrastructure drive revenue and growth across the board.” He highlighted YouTube’s $60 billion milestone and consumer subscriptions’ strength.
Wall Street had anticipated solid growth but the scale of cloud acceleration and AI momentum exceeded forecasts. The $400 billion annual mark — up from $350 billion in 2024 — cements Alphabet’s position among the world’s most valuable companies, with market cap hovering near $4 trillion.
The report also reflects broader tech trends: AI fueling ad dollars (via better targeting and performance), cloud as a high-margin growth engine, and subscriptions providing stable revenue.
Looking ahead, 2026 CapEx plans underscore commitment to AI leadership despite costs. Pichai noted challenges in supply but confidence in opportunities.
For investors, the beat reinforces Alphabet’s resilience. Shares traded volatile post-earnings, but long-term bulls point to AI tailwinds outweighing near-term spending pressures.
Alphabet’s 2025 performance — first $400 billion year — caps a transformative period, positioning the company to capitalize on AI’s next wave while defending core businesses.