Google’s parent company, Alphabet Inc., reported a significant $34.5 billion in net income for the first quarter of 2025, marking a 46 percent increase from the same period in the previous year, per the company’s financial report.
This multibillion-dollar surge is largely attributed to Alphabet’s aggressive investments in cloud services and artificial intelligence (AI) technologies.
The outcomes follow Alphabet’s latest, most ambitious investment programme. The business promised in the fourth quarter of last year to spend about $75 billion on capital projects in 2025, primarily to expand cloud infrastructure and artificial intelligence.
With competitors like Microsoft-backed OpenAI in the fiercely competitive field of AI development, Alphabet’s impressive earnings and dividend increase come at a critical time. But the data indicates that Alphabet’s AI approach is already producing observable financial benefits.
The Chief Executive Officer, Sundar Pichai, said, “We’re pleased with our strong Q1 results, which reflect healthy growth and momentum across the business. Underpinning this growth is our unique full-stack approach to AI.”
He continued, “This quarter was exciting as we rolled out Gemini 2.5, our most intelligent AI model, which is achieving breakthroughs in performance and is an extraordinary foundation for our future innovation.”
“Search saw continued strong growth, boosted by the engagement we’re seeing with features like AI Overviews, which now has 1.5 billion users per month. Driven by YouTube and Google One, we surpassed 270 million paid subscriptions. And Cloud grew rapidly with significant demand for our solutions,” the CEO added.
Google Search, YouTube ads, Google subscriptions, Google Cloud push Q1 2025 revenue to $90.2bn
Google Search, YouTube Ads, Google Subscriptions, and Google Cloud all saw double-digit growth in revenue for the quarter that ended March 31, which increased 12 percent year over year to $90.2 billion. Revenue increased 14 percent in constant currency terms, highlighting Alphabet’s ability to withstand currency fluctuations.
In an effort to reward shareholders for the strong results, Alphabet also announced a five percent increase in its quarterly dividend, bringing it to $0.21 per share.
Google cloud revenue increases by 28% to $12.3 billion
Rising demand for generative AI solutions and AI infrastructure drove a 28 percent increase in Google Cloud revenue to $12.3 billion, while Google Services revenue—which includes advertising and subscriptions—grew 10 percent to $77.3 billion.
The operating margin increased to 34 percent from 32 percent a year earlier, while operating income increased by 20 percent to $30.6 billion. Strong top-line growth and operational efficiency were reflected in the 49 percent increase in diluted earnings per share to $2.81.
Google’s AI-powered search engine records 1.5 billion users monthly
The business pointed out that over 1.5 billion users use its new AI-powered search tools each month, especially AI Overviews.
The company also celebrated reaching 270 million paid subscribers for services like Google One and YouTube Premium, indicating that its non-advertising businesses are still doing well.