Alphabet (GOOG) Q2 2026 earnings summary

Executive summary

• Revenue grew 24% year-over-year to $119.8 billion, marking the 12th consecutive quarter of double-digit growth.

• Net income surged 298% to $112.1 billion, with diluted EPS up 294% to $9.11, reflecting significant unrealized gains in equity securities.

• Operating income rose 30% year-over-year to $40.8 billion, with operating margin improving to 34%.

• AI-driven products and services, including Gemini Enterprise, saw broad adoption, with nearly 90% of the Fortune 100 using it.

• Major capital raises included $49.6 billion from equity and preferred stock offerings, supporting AI infrastructure and global compute expansion.

Financial highlights

• Google Services revenue increased 15% to $94.5 billion; Google Cloud revenue jumped 82% to $24.8 billion year-over-year.

• Operating income grew 30% to $40.8 billion; operating margin improved to 34% from 32%.

• Free cash flow for the quarter was negative $5.9 billion due to significant capital expenditures.

• Operating cash flow for Q2 2026 was $39.1 billion; capital expenditures reached $44.9 billion, focused on technical infrastructure.

• Cash, cash equivalents, and marketable securities rose to $242.5 billion.

Outlook and guidance

• Management expects continued high investment in technical infrastructure, especially AI and data centers, with capital expenditures for 2026 significantly above 2025 levels.

• Liquidity remains strong, with $242.5 billion in cash, cash equivalents, and short-term marketable securities as of June 30, 2026.

• Free cash flow will remain under pressure due to ongoing infrastructure investments.

• Forward-looking statements caution about risks and uncertainties that could impact future results.

• Cloud demand remains strong; majority of TPU system sales revenue to be recognized in 2027.