Alphabet (GOOG, Financial) (GOOGL, Financial) just posted its Q3 earnings, smashing expectations with a 15% revenue surge to $88.3 billion, beating both growth and margin forecasts, driving its share price jump by 7% earlier today. The tech giant's core revenue engines—Google Services and Google Cloud—powered impressive gains. Google Services revenue rose 13% to $76.5 billion, fueled by robust demand in Search, YouTube, and platform subscriptions. Meanwhile, Google Cloud revenue jumped 35% to $11.4 billion, underscoring the strength of Alphabet's AI infrastructure and GCP solutions. CEO Sundar Pichai commented on this momentum, saying that Alphabet's heavy AI investments are bringing tangible value to customers and partners, translating into improved margins and deeper engagement across platforms.
Analysts are taking note. Wall Street sees Alphabet's dominance in AI and cloud as a cornerstone of its growth. Google Search's new AI features, such as Generative AI-powered search, are driving up user engagement and advertiser value, while Cloud's expanding portfolio is securing larger, high-value enterprise deals. YouTube's ad and subscription revenue, now above $50 billion in annualized revenue, adds another layer of strength. Analysts from Morgan Stanley to Needham have raised their price targets, with some emphasizing that Alphabet's AI strategy gives it a critical edge over competitors, setting it up for continued gains across its business lines.
Alphabet also announced a cash dividend of $0.20 per share across Class A, B, and C shares, totaling $2.5 billion for the quarter and set for distribution on December 16, 2024. This dividend, combined with Alphabet's impressive Q3 performance, underscores a powerful combination of strong shareholder returns and relentless growth investment. Alphabet's drive in AI, Search, and Cloud positions it as a formidable leader in tech, and as these segments continue to scale, it's clear this company is steering toward a future of expanding influence and shareholder value.
