Alphabet: AI, Cloud, and Search Are Firing on All Cylinders

Alphabet’s Next Chapter: AI + Cloud = Acceleration

Alphabet just delivered one of its strongest quarters in recent memory, proving that Google remains one of the most important AI infrastructure companies in the world.

Revenue surged to $102.3B (+16% YoY), marking the fastest growth rate in several years, while EPS jumped 35% YoY to $2.87. Even after absorbing a $3.45B EU antitrust fine, Alphabet still expanded margins, a sign of powerful operating leverage across its core businesses.

Behind the headlines is a clear story: Google Cloud and Google’s AI ecosystem now form the company’s dominant growth flywheel.

Google Cloud: The Star of the Show

If there’s one division driving Alphabet’s next decade, it’s Google Cloud.

Q3 Highlights

• Revenue: $15.2B (+34% YoY)

• Operating Margin: +660 bps YoY

• Backlog: $155B up an incredible 46% sequentially

• Key drivers: AI infrastructure, enterprise AI tools, and generative AI demand

This is the second consecutive quarter of accelerating cloud growth, proving that demand is intensifying, not slowing.

Alphabet also announced a massive partnership with Anthropic, supplying over 1 million Ironwood TPUs and more than 1 gigawatt of compute capacity by 2026, in what is expected to be a $50B multi-year deal.

This deal is critical, it positions Google Cloud as the backbone for one of the most advanced AI model developers in the world.

AI Leadership: Ironwood TPUs + Gemini Distribution

Alphabet unveiled its 7th generation TPU — Ironwood, built specifically for high-performance inference.

Ironwood advantages:

• 3x more powerful than the previous generation

• Scales up to 9,216 liquid-cooled chips per pod

• Competes directly with Nvidia’s custom silicon

• Ideal for LLM inference where cost per token is critical

Google’s AI stack has never been stronger from chips to data centers to models.

Gemini Expansion via Apple

Alphabet is reportedly finalizing a deal with Apple to power Siri using its latest Gemini model, a partnership worth roughly $1B/year.

If executed, Gemini becomes the default AI assistant for:

• All Android devices (directly)

• All Apple devices (indirectly)

• Every Chrome user

• Billions of search queries

This would give Alphabet an AI reach no competitor can match, not even OpenAI or Meta.

Technical Outlook: Trend Still Pointing Up

With prices finding a temporary support around the 270-275 level whilst consolidating under the 300.00 psychological resistance, momentum continues to build up as buyers look to accumulate on the dips.

Consolidation within the 275 support and 300 resistance could be expected due to market recent weakness, however the 20d, 100d, 200d moving averages continue to slope up signalling the longer term uptrend is inline with the shorter term momentum.

With 2 1GT Bullish signals still in play, a breach above the 300.00 resistance could open the doors toward the next target of 325.00, if the 275 support gives way next support could be found near the 260 level.

Alphabet Earnings Summary — Q3 2025 vs Q3 2024

Final Take: Alphabet Is Entering Its Strongest Growth Cycle in a Decade

Alphabet today is far more than a search engine. It has grown into a powerful combination of hyperscale cloud provider, AI infrastructure leader, and dominant advertising platform.

With cloud growth accelerating, a massive AI backlog building, powerful new TPU technology, and Gemini expanding across both Android and Apple ecosystems, the company is entering one of its strongest growth cycles in over a decade. Search and YouTube continue to show solid momentum, margins remain healthy even with rising CAPEX, and cash generation is improving quickly.

Despite the recent rally, Alphabet still offers attractive upside as AI adoption broadens and monetisation ramps across its core businesses.

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Sources:
1. “Alphabet Announces Third Quarter 2025 Results”, Available at: https://s206.q4cdn.com/479360582/files/doc_financials/2025/q3/2025q3-alphabet-earnings-release.pdf
2. Alphabet hikes capex again after earnings beat on strong ad, cloud demand. Available at: https://www.reuters.com/business/media-telecom/alphabet-beats-quarterly-revenue-estimates-strong-ad-cloud-demand-2025-10-29

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