Despite delivering another quarter of solid financial results, Alphabet’s share price was hammered amid elevated AI investments and an unstable geopolitical environment. While the company delivered an improved user experience and better value for advertisers, market sentiment was weighed down as management raised its capital expenditure (CapEx) guidance.
| Segmental Revenue | Q2 2025 (US$ million) | Q2 2026 (US$ million) | Percentage change |
| Google Services | 82,543 | 94,540 | +14.5% |
| -Google Search & other | 54,190 | 63,271 | +16.8% |
| -YouTube ads | 9,796 | 11,055 | +12.9% |
| -Google Network | 7,354 | 7,303 | -0.7% |
| -Google subscriptions, platforms, and devices | 11,203 | 12,911 | +15.2% |
| Google Cloud | 13,624 | 24,768 | +81.8% |
| Other Bets | 373 | 382 | +2.4% |
| Hedging gains (losses) | (112) | 106 | n.m. |
| Total | 96,428 | 119,796 | +24.2% |
The company recorded double-digit revenue growth for 12 consecutive quarters in Q2 2026, driven by growth across Google Cloud, Search, and YouTube ads. Operating income increased 30.4% year-on-year to US$40.8 billion during the quarter while operating margin expanded from 32.4% in Q2 2025 to 34.0% in Q2 2026.
Revenue growth in Google Search was driven by the retail, finance, technology, media, and entertainment verticals. YouTube ads growth was driven by direct response among small and medium businesses
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