Alphabet's Q2 Earnings Exceed Expectations, Google Cloud Leads the Way

Alphabet's Q2 report exceeded expectations with a 11.7% increase in revenue to $54.19B and a 13.1% increase in YouTube ads revenue to $9.8B. Google Cloud was the standout performer, with revenue growth not specified. The company raised its spending forecast, driven by strong performance in its cloud business and advertising revenues.

Alphabet Inc. (GOOGL) reported its second-quarter (Q2) earnings on Wednesday, July 1, 2025, showing a significant increase in revenue and strong performance across its key segments. The company's total revenue rose by 11.7% to $54.19 billion, exceeding analyst expectations [2]. This growth was primarily driven by robust performance in the Google Cloud and YouTube segments.

YouTube, Alphabet's video platform, continued its impressive growth, with advertising revenue increasing by 13.1% year over year to $9.8 billion. This marks the latest in a series of strong quarters for YouTube, which has become a significant contributor to Alphabet's overall revenue [4]. The company's CEO, Sundar Pichai, noted that AI is positively impacting every part of the business, including YouTube, where AI features like AI Overviews and AI Mode are performing well.

The standout performer in Alphabet's Q2 report was Google Cloud, which saw significant revenue growth, although the exact figure is not specified in the provided materials [1, 3]. The company's cloud computing business has been a key driver of growth, with revenue accelerating and other financial metrics improving. Analysts highlighted the strong performance of Google Cloud, with Oppenheimer analyst Jason Helfstein noting that it "absolutely crushed it" with 32% year-over-year growth [3]. Additionally, the number of Google Cloud deals worth more than $250 million doubled year over year, indicating strong demand for the service.

Alphabet's strong Q2 performance led to an increase in its capital expenditure forecast for 2025. The company expects to spend approximately $85 billion in 2025, up from the previous guidance of $75 billion. Much of this spending will go toward computer servers and other AI-related infrastructure, reflecting Alphabet's continued investment in its cloud business and AI capabilities [2, 3].

The company's stock price reacted positively to the earnings report, gaining over 3.6% in early trading on Thursday, July 2. Google stock is currently trading at around $19.06, with a strong July performance that has brought it back to even levels for the year [3].

References:

[1] Reuters. (2025). Gaming and Leisure Properties Q2 Revenue Beats Estimates. Retrieved from https://www.tradingview.com/news/reuters.com,2025:newsml_PLX274254:0-gaming-and-leisure-properties-q2-revenue-beats-estimates/

[2] ConstellationR. (2025). Google Cloud Revenue Surges 32% in Q2. Retrieved from https://www.constellationr.com/blog-news/insights/google-cloud-tops-50-billion-annual-revenue-run-rate-q2

[3] Ink. (2025). Google Cloud Delivers Q2 Knockout, Sends Message to Amazon, Microsoft. Retrieved from https://www.inkl.com/news/google-cloud-delivers-q2-knockout-sends-message-to-amazon-microsoft

[4] Variety. (2025). YouTube Q2 2025 Earnings: Ad Revenue Rises 13%. Retrieved from https://variety.com/2025/digital/news/youtube-q2-2025-earnings-ad-revenue-alphabet-1236468214/