Both companies are spending big on AI, but Google's diversified business and cost discipline could help it pull ahead
Alphabet delivered strong Q3'25 earnings, driven by double-digit Cloud growth and robust digital advertising performance. Google's aggressive AI and Cloud-focused CapEx is fueling operating income expansion, with free cash flow up 38.7% year-over-year. Google is set to benefit from a strong digital advertising market in Q4 and will likely continue to buy back a ton of its shares going forward.
Shares of Google parent Alphabet Inc (NASDAQ:GOOGL) are up 4.2% to trade at $286.05 at last glance, after the company reported record revenue of $100 billion for the third quarter, surpassing analysts' expectations.
Alphabet stock jumped after the company reported strong third-quarter results and increased its capital expenditures for the year. CEO Sundar Pichai said the company had a $155 billion backlog for Google Cloud at the end of the quarter.
EnduroSat said on Thursday it has raised $104 million from investors, including Google Ventures, Lux Capital and the European Investment Council, as the Bulgaria-based company scales up production of its small and midsized satellites.
Alphabet remains a top conviction holding, with strong Q3 results and accelerating growth across Cloud, Search, YouTube, and Subscriptions. GOOGL's record capex is well supported by robust operating cash flow, while moderation of share buybacks is prudent amid the rising share price. YouTube's dominance in teen video consumption and music streaming underpins Alphabet's media strength and offers significant monetization headroom.
Alphabet is rated Strong Buy, offering the best risk-reward profile among mega-cap tech stocks with robust growth across Search, YouTube, and Google Cloud. The company's integration of AI Overviews and AI Mode strengthens its search moat, keeping users engaged and defending against AI chatbot disruption. YouTube continues to dominate streaming and short-form video, while Google Cloud outpaces competitors with AI-native architecture and custom TPUs, driving future profitability.
Alphabet Inc. delivered a standout Q3 earnings report, beating profit estimates by over 20% and showcasing robust business growth. GOOG's per-share profits exceeded analyst forecasts by 27%, marking one of the largest earnings beats in recent memory and driving a 5% share price jump. Wall Street continues to underestimate GOOG's growth potential, as the company has outperformed expectations in nine of the last ten quarters.
The headline numbers for Alphabet (GOOGL) give insight into how the company performed in the quarter ended September 2025, but it may be worthwhile to compare some of its key metrics to Wall Street estimates and the year-ago actuals.
Alphabet's (GOOGL) third-quarter results topped analysts' expectations, as the tech giant surpassed $100 billion in revenue for the first time.
Google-parent Alphabet beat Wall Street estimates for third-quarter revenue on Wednesday, as both its core advertising business and cloud computing unit showed steady growth.
The internet company said profit for the quarter was up 33 percent, to just under $35 billion.