Google Cloud's Remaining Performance Obligation Hits $106B, Outpacing Revenue Growth: Kurian.

Google Cloud's remaining performance obligation reached $106B, growing faster than revenue. CEO Thomas Kurian attributes the growth to capturing new customers faster due to product differentiation in AI. The company is also deepening its relationship with existing customers.

Google Cloud's CEO, Thomas Kurian, has revealed that the company's remaining performance obligations have reached a significant milestone of $106 billion, growing at a pace faster than its revenue. This rapid expansion is attributed to Google Cloud's strategic differentiation in AI, according to Kurian's statements at the Goldman Sachs Communacopia + Technology Conference Google Cloud's remaining performance obligation at $106B, growing faster than revenue, says Google Cloud CEO^[1].

Kurian highlighted several key factors driving this growth. First, Google Cloud is capturing new customers at a faster rate due to its product differentiation in AI. The company boasts deep product differentiation in performance, cost, reliability, and efficiency in AI infrastructure. Additionally, Google Cloud offers a leading suite of best-in-class generative AI models and has been developing domain-specific AI applications and agents that are now gaining significant interest from customers.

The company's AI monetization strategy involves multiple avenues, including growth from net new customers, deeper relationships with existing customers, and broadening its total addressable market. These factors have collectively contributed to a substantial increase in revenue and operating margins, as well as a significant growth in the remaining performance obligations.

Kurian noted that Google Cloud has seen a 28% sequential quarter-over-quarter growth in new customer wins in the first half of 2025. The company's AI systems are optimized for high-performance, reliable, and scalable training, as well as for inference. Google's latest AI model, Gemini 2.5, achieved 1 trillion tokens 20 times faster than its predecessor, Gemini 1.5, demonstrating significant advancements in AI capabilities.

The company is also seeing large-scale adoption of its AI models by the developer community and various industries. For instance, Canva uses Google Cloud's diffusion models for creating image and video content, while ServiceNow leverages these models for their SaaS offerings. Google Cloud's AI is being utilized across multiple domains, including building digital products, transforming customer service, streamlining core operations, and improving IT departments' coding quality.

Kurian also discussed the challenges and opportunities in cloud adoption, noting that while some sectors like government agencies and European organizations move slower due to compliance and regulation, the overall trend is positive. Google Cloud is investing heavily in its go-to-market organization and addressing potential power issues by designing early solutions, such as water cooling.

Overall, Google Cloud's impressive growth in performance obligations underscores the company's robust AI strategy and its ability to capture a significant share of the market. This development is likely to be closely watched by investors and financial professionals for its potential impact on Google's overall financial performance and market position.