- Google’s parent company, Alphabet, reported fourth-quarter earnings on Tuesday.
- The tech giant beat on revenue, reporting 12% growth across its business.
- Alphabet continues to bet heavily on AI despite industry disruption from China’s DeepSeek.
Alphabet reported fourth-quarter earnings on Tuesday. Slowing growth in its Cloud Services business and a bigger-than-expected capex forecast for 2025 dragged shares down more than 7% in postmarket trading.
Google’s parent company beat on consolidated revenue in the quarter, growing 12% to $96.5 billion. Its key Cloud Services business’ sales fell slightly short of expectations.
Alphabet said it plans about $75 billion in capital expenditures this year. Analysts surveyed by Bloomberg had expected $57.9 billion. Big Tech companies have been increasingly under scrutiny for their heavy investments in AI.
“Q4 was a strong quarter driven by our leadership in AI and momentum across the business,” Alphabet and Google CEO Sundar Pichai said in the earnings release. “We are building, testing, and launching products and models faster than ever, and making significant progress in compute and driving efficiencies.”
Here are the key numbers for the fourth quarter compared to analysts’ estimates compiled by Bloomberg:
- Earnings per share: $2.15 vs. $2.13 expected
- Revenue: $96.5 billion vs. $96.62 billion expected
- Google advertising revenue: $72.46 billion vs. $71.73 billion
- YouTube advertising revenue: $10.47 billion vs. $10.22 billion expected
- Google Cloud revenue: $12.0 billion vs. $12.19 billion expected
Google’s stock has, over the last year, been buoyed by optimism surrounding its heavy investments in artificial intelligence, including Gemini, its AI assistant. This optimism continued in the company’s latest earnings report, despite recent industry disruption from the Chinese startup DeepSeek.
In late January, DeepSeek released its open-source AI model, which appeared to operate similarly well to US ones but which the company said was scaled for about $6 million — significantly less than the amount Big Tech companies have been investing in AI.
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