Alphabet’s fourth-quarter 2025 earnings of $2.82 per share beat estimates by 9.73% and increased 31.2% year over year. Revenues of $113.8 billion were up 18% year over year. Google Services revenues rose 14% to $95.86 billion, while Google Cloud revenues surged 47.8% to $17.66 billion. Google Cloud ended 2025 with an annual run rate of over $70 billion.

Google’s Services saw a 16.7% increase in revenues to $63.07 billion, driven by AI Overviews and AI Mode. YouTube’s advertising revenues improved 8.7% to $11.38 billion, with Shorts averaging over 200 billion daily views. Google advertising revenues rose 13.6% to $82.28 billion, but Google Network revenues declined 1.6% to $7.82 billion.

Google Cloud ended the quarter with $240 billion in backlog, with nearly 75% of customers using Alphabet’s AI products. Revenues from AI models grew over 400% year over year, and Workspace showed double-digit growth. Operating margin was 31.6%, up from the year before, with Google Services’ margin expanding to 41.9%.

Alphabet’s balance sheet remains strong, with $1.26 billion in cash and marketable securities. Long-term debt stood at $46.54 billion. The company generated $52.4 billion in cash from operations in Q4 2025, spending $27.85 billion on capital expenditure. Alphabet plans to spend between $175 billion and $185 billion on capital expenditures in 2026.

Alphabet has a Zacks Rank #3 (Hold). Better-ranked stocks in the sector include Arista Networks, Advanced Energy, and Amkor Technology. Arista Networks has gained 6.1% in the last six months, Advanced Energy 82.1%, and Amkor Technology 97.6%. Analysts are optimistic about the potential of a lesser-known satellite-based communications firm.

Read more at Nasdaq: Alphabet’s Q4 Earnings Beat Estimates, Revenues Increase Y/Y