Alphabet Inc (NASDAQ:GOOG) reported first quarter results that beat Wall Street expectations, sending its shares almost 4% higher after Wednesday’s closing bell.
The company posted revenue of $109.9 billion for the quarter ended March 31, up 22% year over year and above analyst estimates of $107.1 billion.
Earnings per share came in at $2.81, topping expectations of $2.62.
Growth was led by continued momentum in Google Cloud, where revenue increased 63% year over year to $20 billion, ahead of estimates of $18.4 billion. The company attributed the acceleration to demand for enterprise AI solutions, AI infrastructure, and core Google Cloud Platform services.
Google Services, which includes search, YouTube, and subscriptions, generated $89.6 billion in revenue, up 16% from a year earlier. Within the segment, Google Search and other revenue rose 19%, while subscriptions, platforms, and devices also grew 19%, and YouTube advertising increased 11%.
Alphabet said its results marked its 11th consecutive quarter of double-digit revenue growth.
Profitability also improved during the quarter. Operating income rose 30% year over year, with operating margin expanding by 2 percentage points to 36.1%.
Net income increased 81% from the prior year period, while EPS rose 82% to $5.11 on a GAAP basis. The company also recorded other income of $37.7 billion, primarily driven by unrealized gains on nonmarketable equity securities.
Alphabet CEO Sundar Pichai said the company is seeing broad AI-driven strength across its businesses, describing the quarter as a strong start to the year. He said AI investments are “lighting up every part of the business,” pointing to growth in search, cloud, and consumer AI products.
“2026 is off to a terrific start. Our AI investments and full stack approach are lighting up every part of the business,” Pichai said.
He added that search saw strong momentum driven by AI features, with usage and queries at record levels and revenue growth of 19%. He also highlighted Google Cloud’s expansion, saying backlog nearly doubled quarter over quarter to more than $460 billion.
Pichai said consumer AI products had their strongest quarter to date, led by the Gemini app, while overall paid subscriptions reached 350 million across services including YouTube and Google One. He also noted growing adoption of enterprise AI tools, including Gemini Enterprise, which saw 40% quarter-over-quarter growth in paid monthly active users.
On infrastructure and usage, he said the company’s models are scaling rapidly. “Our first-party models, like Gemini, are now processing more than 16 billion tokens per minute via direct API use by our customers, up 60% from last quarter.”
He added that Waymo surpassed 500,000 fully autonomous rides per week, underscoring progress in long-term bets beyond core advertising and cloud businesses.
“It’s really exciting to see how our AI investments are delivering value for our users, customers and business,” Pichai said.
Alphabet announced a 5% increase to its dividend, bringing its quarterly cash dividend to $0.22 per share.