01—Abstract
Summary
Summary of the 10-Q filed April 30, 2026. Cited figures are marked; the original filing is the authoritative source.
Alphabet Inc. reported a strong first quarter for 2026, with revenues surging by 22% year-over-year to $109.9 billiona.
This robust growth was fueled by a significant 16% increase in Google Services revenues and an impressive 63% surge in Google Cloud revenues. The company's operating income also saw a substantial 30% jump to $39.7 billionb, indicating improved operational efficiency and profitability. A major driver of Alphabet's financial performance was a significant increase in 'Other income (expense), net,' which rose by 237% to $37.7 billion, largely attributed to substantial unrealized gains on equity securities, particularly non-marketable ones.
This positive financial momentum is supported by strong operating cash flow of $45.8 billionc and significant investments in technical infrastructure, including $35.7 billion in capital expenditures during the quarter. The company also highlighted strategic acquisitions, including the completion of Wiz for $29.5 billion and Intersect for $5.9 billion, aimed at accelerating capabilities in cloud security, AI, and renewable energy.
Additionally, Alphabet announced a $40 billiond investment in a private company for future capital funding and a pending divestiture of GFiber. These strategic moves, combined with continued revenue growth across its core segments, position Alphabet for sustained expansion and market leadership.
02—Key points
Key Highlights
- Total revenues grew 22% year-over-year to $109.9 billion, driven by strong performance in both Google Services and Google Cloud.
- Google Cloud revenue surged by 63% year-over-year, demonstrating accelerated adoption and growth in enterprise solutions.
- Operating income increased by 30% to $39.7 billion, with operating margins improving to 36%.
- Other income (expense), net, saw a significant increase of 237% to $37.7 billion, primarily due to substantial unrealized gains on equity securities.
- Capital expenditures reached $35.7 billion, reflecting continued significant investment in technical infrastructure and AI capabilities.
- Alphabet completed two major acquisitions: Wiz for $29.5 billion and Intersect for $5.9 billion, enhancing its strategic positioning in cloud security, AI, and renewable energy.
- The company announced a substantial $40 billion investment in a private company, signaling a commitment to future growth and strategic partnerships.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2026, Alphabet Inc. kept $0.57.
- Revenue$109.90B100.0%
- Cost of revenue−$41.27B37.6%
- Gross profit$68.63B62.4%
- Operating costs−$28.93B26.3%
- Operating income$39.70B36.1%
- Interest, other & tax$22.88B20.8%
- Net income$62.58B56.9%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2026filed April 30, 2026Financial Statements
Q1 FY2026 against Q1 FY2025
| Line item | Q1 FY2026Q1 FY2025 | Change |
|---|---|---|
| Revenue | $109.90B$90.23B | +21.8% |
| Cost of Revenue | $41.27B$36.36B | +13.5% |
| Gross Profit | $68.63B$53.87B | +27.4% |
| R&D Expenses | $17.03B$13.56B | +25.6% |
| Operating Expenses | $70.20B$59.63B | +17.7% |
| Operating Income | $39.70B$30.61B | +29.7% |
| Net Income | $62.58B$34.54B | +81.2% |
| EPS (Basic) | $5.17$2.84 | +82.0% |
| EPS (Diluted) | $5.11$2.81 | +81.9% |
| Shares Outstanding (Basic) | 12.10B12.18B | −0.7% |
| Shares Outstanding (Diluted) | 12.24B12.29B | −0.4% |
05—Questions
Frequently Asked Questions
What was the primary driver of Alphabet's revenue growth in Q1 2026?
Alphabet's revenue grew by 22% year-over-year to $109.9 billion, primarily driven by a 16% increase in Google Services revenues and a substantial 63% increase in Google Cloud revenues. This broad-based growth across its key segments reflects strong market demand for its diverse offerings.
How did the acquisitions of Wiz and Intersect impact Alphabet's financial position?
Alphabet completed the acquisition of Wiz for $29.5 billion and Intersect for $5.9 billion during the quarter. These strategic acquisitions are expected to accelerate Alphabet's capabilities in AI-driven security (Wiz) and renewable energy (Intersect), contributing to future growth and innovation, particularly within the Google Cloud segment for Wiz.
What is the significance of the large increase in 'Other income (expense), net'?
The 'Other income (expense), net' increased significantly by 237% to $37.7 billion. This was largely due to substantial unrealized gains on equity securities, particularly on non-marketable equity securities, reflecting favorable market adjustments and investment performance rather than operational revenue.
How is Alphabet investing its capital, and what does this indicate for future growth?
Alphabet significantly increased its capital expenditures to $35.7 billion in Q1 2026, primarily for technical infrastructure. Coupled with strategic investments like the $40 billion commitment to a private company, this demonstrates a strong focus on long-term growth, particularly in AI, cloud computing, and other future-oriented technologies.
06—Continue