Alphabet reported revenue of $109.9 billion during the January-March period, higher than expectations of $107.2 billion. Earnings Per Share (EPS) stood at $5.11. The revenue figure meant a growth of 20% from last year, marking the highest rate of growth in any quarter since 2022.
The topline growth came from Google Cloud, which reported sales of $20.02 billion, comfortably above expectations of $18.05 billion. That’s a 63% increase from the year-ago period. CEO Sundar Pichai said that the company’s enterprise AI solutions have become their primary growth driver for the cloud business for the first time. He also added that their cloud revenue would have been higher had they managed to meet demand.
Gemini Enterprise’s paid monthly active users increased by 40% from the previous quarter.
Another highlight of Alphabet’s quarter was yet another increase in the capex guidance. Alphabet now expects to spend between $180 billion to $190 billion this year, higher than the $175 billion to $185 billion project earlier. For the quarter gone by, Alphabet spent $35.7 billion towards real estate, servers, data centers and other infrastructure.
Order backlog, the measure of contracted work that has not been converted to revenue yet, nearly doubled on a sequential basis to over $460 billion. Alphabet will also increase its dividend payout by 5%, resulting in a quarterly cash outgo of $0.22 per share.
Shares of Alphabet are up 6.5% in extended trading to $369.71. If these gains hold in regular trade, it will be a new high for the stock, with its market capitalization nearing $4.5 trillion. The stock has risen 27% so far in the last one month.
