In the recent earnings report, Google Cloud stood out as a key growth driver for Alphabet, recording an impressive year-over-year revenue increase of over 30%. As more businesses demand AI-enhanced services, Google Cloud has shown its capacity to meet this demand, illustrating a robust future trajectory.
The earnings report highlighted Alphabet’s consolidated revenues at $96.4 billion for the quarter. Google Services contributed significantly with $83 billion, displaying a healthy 12% growth. On the other hand, Google Cloud’s revenue of $13.6 billion marked a remarkable 32% rise from a year ago. Chief Executive Officer Sundar Pichai remarked, “AI is positively impacting every part of the business, driving strong momentum.”
Furthermore, Alphabet’s capital expenditure reached $22.4 billion, mostly allocated to infrastructure. Approximately two-thirds of this spending was directed toward purchasing servers, while the remainder was allocated to data centers and networking equipment. Notably, the company plans to invest an additional $10 billion this year in this area.
A significant observation is the sharp increase in large-scale business deals. According to Sundar Pichai, deals valued over $250 million doubled this year compared to the previous one. Impressively, Google Cloud has already matched the number of $1 billion deals signed in 2024 within the first half of 2025 alone.
The introduction of AI-driven features has also increased overall search volumes. Pichai noted that queries integrated with AI Overviews saw a 10% increase in volume. This is compounded by the fact that the platform’s AI Overview feature serves over 2 billion global users monthly.
Additionally, the customer base for Google Cloud Platform (GCP) services has grown by almost 30% quarter-over-quarter. Enterprises are rapidly adopting its AI tools, with more than 85,000 entities relying on their Gemini AI software. Key players such as Salesforce leverage these services, while others like Wayfair and Target utilize Google Cloud’s database integrations and security solutions to enhance customer experience and bolster cybersecurity measures, respectively.
Looking towards the future, there’s excitement surrounding Agentspace, a platform announced by Google to enable businesses to craft their AI agents. Although not generally available, the product already boasts over a million subscriptions.
