GOOGL stock: Google Cloud grows 103%, but shares fall

What happened. Alphabet, Google's parent, reported results on 28 October for the quarter ended 30 September 2026. Revenue was $127.6 billion against $102.3 billion a year earlier, up 25%. Operating income was $40.6 billion (+30%) and the operating margin 31.8%.

Cloud. Google Cloud brought in $30.7 billion, up from $15.2 billion a year ago. That is 103% growth. Cloud operating income was $11.1 billion. CEO Sundar Pichai points to strong demand for TPU systems, Google's own AI chips. Per CNBC, analysts expected $28.7 billion from cloud.

Search and YouTube. Google Services brought in $96.3 billion (+11%). Search and other was $63.4 billion (+12%), against an estimate of $64.96 billion cited by CNBC. YouTube ads were $11.2 billion, up from $10.3 billion.

Why EPS fell. Net income for common shareholders was $26.2 billion, or $2.12 a share, against $2.87 a year ago. An $8.7 billion loss on equity stakes in other companies cut EPS by $0.55. Per CNBC, the same stakes gave a big gain in the second quarter. LSEG expected $3.02 a share, but CNBC says it is not clear the figures are comparable.

Cash and spending. Purchases of property and equipment were $51.4 billion, up from $24.0 billion. Free cash flow was minus $9.1 billion. Per CNBC, analysts expected capex of $55.1 billion and free cash flow of minus $2.7 billion. There were no buybacks in the quarter. A $0.22 dividend is paid on 14 December.

Market reaction. Per CNBC, the shares fell more than 7% after the close. That is a snapshot and the price will keep moving.

What we don't know. What the company says about 2027 spending, and where the shares close on 29 October. This is an overview, not a forecast or advice.

已确认的事实

• Alphabet revenue for the quarter ended 30 September 2026 was $127.577 billion (+25%), against $102.346 billion a year earlier.^[1]
• Google Cloud revenue was $30.709 billion (+103%) against $15.157 billion; cloud operating income was $11.121 billion.^[1]
• Google Services revenue was $96.302 billion (+11%), Search and other $63.350 billion (+12%), YouTube ads $11.207 billion against $10.261 billion.^[1]
• Operating income was $40.576 billion (+30%), with a 31.8% operating margin.^[1]
• Net income available to common shareholders was $26.17 billion; diluted EPS $2.12 against $2.87 a year earlier.^[1]
• An $8.7 billion loss on equity securities reduced diluted EPS by $0.55.^[1]
• Purchases of property and equipment were $51.355 billion against $23.953 billion; free cash flow was minus $9.065 billion.^[1]
• Quarterly dividend of $0.22 a share, paid 14 December 2026 to holders of record on 7 December. No buybacks in the quarter.^[1]
• Sundar Pichai: the company is now on a half-trillion dollar revenue run rate, with strong demand for TPU systems.^[1]
• LSEG estimates: revenue $128.22 billion, EPS $3.02 (comparability unclear).^[2]
• Analyst estimates: cloud $28.7 billion, Search $64.96 billion, capex $55.09 billion, free cash flow minus $2.70 billion; FactSet operating income $43.19 billion.^[2]
• Alphabet shares fell more than 7% after hours.^[2]
• Pichai said the Gemini app reached 1 billion users.^[2]

影响

• 已确认Google Cloud doubled in a year and is now the second big revenue engine after ads.
• 我们的解读Huge AI spending is eating free cash flow for now, and the market reacts to that more than to revenue growth.
• 我们的解读The GOOGL reaction may weigh on sentiment toward other big tech firms that also spend heavily on AI.

仍未知

• The 2027 spending plan, which may come on the analyst call.
• Where the shares close in the 29 October session; after-hours is not the final word.
• Whether stakes in other companies keep swinging profit sharply.

影响到谁

United States, World. People who follow GOOGL, cloud and AI spending, and holders of big tech stocks

来源

1. Alphabet Inc. (SEC filing, Form 8-K Exhibit 99.1): Alphabet Announces Third Quarter 2026 Results 2026年10月28日 · 官方
2. CNBC: Alphabet's free cash flow sinks further, Q3 capex expectations miss in worrying sign for AI trade 2026年10月28日 · 媒体