Alphabet — Financial Results
Revenue Grew 15% to $403 Billion, Led by Search and Cloud
| Metric | 2024 | 2025 | Change |
|---|---|---|---|
| Total Revenue | $350.0B | $402.8B | +15% |
| Google Search & other | $198.1B | $224.5B | +13% |
| Google Cloud | $43.2B | $58.7B | +36% |
| Net Income | $100.1B | $132.2B | +32% |
Alphabet had a strong year, with revenue crossing $400 billion for the first time. Google Search remains the engine of the business, growing $26.4 billion as more users searched on mobile and advertisers spent more. Google Cloud was the standout grower at 36%, driven by demand for AI infrastructure and platform services.
Google Cloud's Profitability More Than Doubled
| Metric | 2024 | 2025 | Change |
|---|---|---|---|
| Google Cloud Operating Income | $6.1B | $13.9B | +128% |
| Google Cloud Operating Margin | ~14% | ~24% | +10pp |
Cloud is not just growing fast — it is becoming meaningfully profitable. Operating income (revenue minus costs) more than doubled in a single year. This matters because Cloud has historically been a lower-margin business, and this shift suggests the heavy infrastructure investments are starting to pay off.
Capital Spending Nearly Doubled to $91 Billion, With More Promised in 2026
| Metric | 2024 | 2025 |
|---|---|---|
| Capital Expenditures | $52.5B | $91.4B |
| Depreciation | $15.3B | $21.1B |
Alphabet is spending at an extraordinary pace building data centers and buying servers, primarily to support AI. Management explicitly stated they expect to significantly increase this investment again in 2026. This is a long-term bet on AI demand — but it also means costs, particularly depreciation and energy bills, will keep rising for years.
Legal Costs Jumped $6.2 Billion, Including a $3.5 Billion EU Fine
General and administrative expenses rose from $14.2 billion to $21.5 billion, almost entirely due to legal matters. The biggest items were a $3.5 billion fine from the European Commission (EC) and a $1.4 billion legal settlement. As of year-end, Alphabet had $15.6 billion in short-term accrued legal liabilities on its balance sheet — a number worth watching.
A $24 Billion Investment Gain Flattered Net Income
Other income jumped from $7.4 billion to $29.8 billion, almost entirely because of $24.1 billion in unrealized gains (paper profits, not yet sold) on private company investments. This boosted reported net income significantly. Investors should be aware that this is not recurring operating performance — if those investment values fall, the reverse would also flow through earnings.
$45 Billion Returned to Shareholders, Another $70 Billion Authorized
During 2025, Alphabet bought back 240 million shares for $45.4 billion and paid roughly $10 billion in dividends. The board then authorized a fresh $70 billion share repurchase program in April 2025, of which $69.5 billion remained unspent at year-end. With $126.8 billion in cash and equivalents on hand, the company has significant firepower to continue returning capital.