Alphabet Q2 2025 Earnings

Date: July 23, 2025

 

Executive Summary

Alphabet, the parent company of Google, reported strong growth in the second quarter of 2025, with total revenue increasing by 14% year-over-year to $96.4 billion. Profits were also up, with net income rising 19% and earnings per share (EPS) increasing 22% to $2.31. The company saw gains across its main businesses, Search, YouTube, Cloud, and subscriptions, fueled heavily by developments in artificial intelligence (AI). Sundar Pichai noted that AI is having a positive effect across all areas of Alphabet’s business, from Search and YouTube to its Cloud services.

 

Key Financial Highlights

• Total Revenue: $96.4 billion (up 14% from Q2 2024)
• Operating Income: $31.3 billion (up 14%)
• Operating Margin: 32.4%
• Net Income: $28.2 billion (up 19%)
• EPS (Earnings per Share): $2.31 (up 22%)
• Free Cash Flow (last 12 months): $66.7 billion
• Employees: 187,103 (up from 179,582 a year ago)

 

Business Segment Breakdown

Google Services: This includes Search, YouTube, Google Play, Android, devices, and subscriptions like YouTube Premium.

• Revenue: $82.5 billion (up 12%)
• Search & Other Ads: $54.2 billion (up 12%)
• YouTube Ads: $9.8 billion (up 13%)
• Subscriptions, Devices, and Platforms: $11.2 billion (up 20%)
• Operating Profit: $33.1 billion
• Key Note: Search continues to be the biggest moneymaker, and new AI features such as AI Overviews are helping drive growth.

Google Cloud: Includes Google Cloud Platform and Google Workspace.

• Revenue: $13.6 billion (up 32%)
• Operating Profit: $2.8 billion (up from $1.2 billion last year)
• Key Note: AI-powered solutions are boosting customer demand. Cloud’s annual revenue run-rate is now over $50 billion.

Other Bets: Includes experimental ventures such as healthcare and internet services (e.g., Waymo, Verily).

• Revenue: $373 million (flat)
• Loss: $1.25 billion (loss increased slightly)

 

Investments and Spending

• Capital Expenditures: Expected to reach $85 billion for the full year, reflecting major investments in AI and infrastructure.
• Debt Issuance: Alphabet raised $12.5 billion through new bonds to fund operations.

 

Other Notable Points

• A legal settlement affected expenses slightly, but didn't significantly hurt profitability.
• Alphabet’s investments in securities performed well, contributing to a $2.7 billion boost in other income this quarter.
• Despite spending more on AI infrastructure and facilities, Alphabet continues to generate high levels of cash.

 

Geographic Revenue Breakdown

Growth was spread globally:

• United States: $46.1 billion (up 12%)
• EMEA (Europe, Middle East, Africa): $28.3 billion (up 14%)
• APAC (Asia-Pacific): $16.5 billion (up 19%)
• Other Americas (e.g., Latin America): $5.7 billion (up 16%)

 

Source:https://abc.xyz/assets/cc/27/3ada14014efbadd7a58472f1f3f4/2025q2-alphabet-earnings-release.pdf