Alphabet

Alphabet's earnings report shows search queries growing at the fastest rate in five years, but Q3 search revenue growth slowed to 12% year-over-year, highlighting challenges in monetizing AI.

• •Search queries are growing at their fastest rate in five years.
• •Third-quarter search revenue growth slowed to 12% year-over-year, down from roughly 17% in the previous quarter.
• •Growth in paid clicks on ads is also slowing.

Alphabet's Q3 revenue rose 25% to $127.5 billion, but net income fell 25% due to AI investment costs turning free cash flow negative.

• •Revenue increased by 25% to $127.5 billion, while net income decreased by 25% due to losses from SpaceX stock and other factors
• •Google Cloud revenue surged 103%, but massive AI infrastructure investments caused free cash flow to turn negative
• •The stock price dropped over 10% in after-hours trading following the earnings release

Alphabet's third-quarter revenue grew 25% year over year to $127.6 billion, despite slowing growth in core advertising.

• •Alphabet's third-quarter revenue increased by 25% year over year to $127.6 billion
• •The announcement was made alongside Alphabet's third-quarter earnings report
• •The move comes amid slowing growth in core advertising

Alphabet stated in its Q3 2026 earnings that its investments in AI are driving significant year-over-year growth in search queries.

• •CEO Sundar Pichai noted that AI investments are boosting overall search query growth, including commercial queries.
• •The company's year-over-year query growth rate is reported to be at its highest level.
• •This growth is positioned as a direct result of the company's AI investments.