01—Abstract
Summary
Summary of the 10-Q filed April 25, 2025. Cited figures are marked; the original filing is the authoritative source.
Alphabet Inc. (GOOGL) reported strong financial performance for the first quarter of 2025, with total revenues reaching $90.2 billiona, a 12% increase year-over-year.
This growth was primarily fueled by a 10% rise in Google Services revenue to $77.3 billionb and a significant 28% increase in Google Cloud revenue to $12.3 billion. The company also saw a substantial boost in 'Other income (expense), net,' reaching $11.2 billion, largely due to an $8.0 billion unrealized gain on non-marketable equity securities. Net income grew by 46% to $34.5 billion, resulting in diluted EPS of $2.81.
Key strategic initiatives highlighted include the planned acquisition of Wiz, a cloud security platform, for $32.0 billionc, expected to close in 2026, which will bolster the Google Cloud segment. Alphabet also continued its commitment to returning capital to shareholders, repurchasing $15.3 billion in stock and increasing its quarterly dividend by 5% to $0.21 per share. Despite ongoing legal and regulatory scrutiny, particularly in antitrust matters, the company demonstrated robust operational and financial health.
02—Key points
Key Highlights
- Total revenues increased by 12% year-over-year to $90.2 billion, driven by strong performance across Google Services and Google Cloud.
- Google Services revenue grew by 10% to $77.3 billion, with Search & other and YouTube ads showing significant gains.
- Google Cloud revenue surged by 28% to $12.3 billion, indicating continued momentum in the enterprise sector.
- Net income increased by 46% to $34.5 billion, with diluted EPS rising to $2.81.
- Other income (expense), net, significantly increased to $11.2 billion, primarily due to an $8.0 billion unrealized gain on non-marketable equity securities.
- Alphabet announced plans to acquire cloud security leader Wiz for $32.0 billion, further strengthening its Google Cloud offerings.
- The company returned $15.3 billion to shareholders through share repurchases and increased its quarterly dividend by 5% to $0.21 per share.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2025, Alphabet Inc. kept $0.38.
- Revenue$90.23B100.0%
- Cost of revenue−$36.36B40.3%
- Gross profit$53.87B59.7%
- Operating costs−$23.27B25.8%
- Operating income$30.61B33.9%
- Interest, other & tax$3.93B4.4%
- Net income$34.54B38.3%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2025filed April 25, 2025Financial Statements
Q1 FY2025 against Q1 FY2024
| Line item | Q1 FY2025Q1 FY2024 | Change |
|---|---|---|
| Revenue | $90.23B$80.54B | +12.0% |
| Cost of Revenue | $36.36B$33.71B | +7.9% |
| Gross Profit | $53.87B$46.83B | +15.0% |
| R&D Expenses | $13.56B$11.90B | +13.9% |
| Operating Expenses | $59.63B$55.07B | +8.3% |
| Operating Income | $30.61B$25.47B | +20.2% |
| Net Income | $34.54B$23.66B | +46.0% |
| EPS (Basic) | $2.84$1.91 | +48.7% |
| EPS (Diluted) | $2.81$1.89 | +48.7% |
| Shares Outstanding (Basic) | 12.18B12.41B | −1.9% |
| Shares Outstanding (Diluted) | 12.29B12.53B | −1.9% |
05—Questions
Frequently Asked Questions
What drove the significant increase in 'Other income (expense), net' this quarter?
The substantial increase in 'Other income (expense), net' to $11.2 billion was primarily driven by an $8.0 billion unrealized gain on non-marketable equity securities. This gain is attributed to fair value adjustments related to observable transactions involving investments in private companies.
How is Alphabet's Google Cloud segment performing?
The Google Cloud segment showed strong growth, with revenues increasing by 28% year-over-year to $12.3 billion. This growth was mainly driven by Google Cloud Platform, particularly infrastructure services and AI offerings, and Google Workspace subscriptions. The segment's operating income also saw a significant increase, rising to $2.2 billion.
What is the strategic rationale behind the planned acquisition of Wiz?
The acquisition of Wiz, a leading cloud security platform for $32.0 billion, is expected to significantly enhance Alphabet's Google Cloud offerings. This strategic move aims to bolster its position in the rapidly growing cloud security market, providing enterprise customers with comprehensive security solutions.
How is Alphabet returning capital to shareholders?
Alphabet is actively returning capital to shareholders through share repurchases and dividends. In the first quarter of 2025, the company repurchased $15.3 billion of its Class A and Class C shares. Additionally, in April 2025, the Board declared a quarterly cash dividend of $0.21 per share, representing a 5% increase from the previous quarter.
06—Continue