Alphabet reported a 19% year-on-year increase in revenue in constant currencies for the first quarter of 2026 to 110 billion US dollars. Cloud revenues were up 63% to 20 billion dollars, driven by strong demand for AI models, such as Gemini 3, and AI infrastructure "due to continued deployment of TPUs and GPUs."
Alphabet also said its revenue backlog nearly doubled quarter-on-quarter to more than 460 billion dollars, with the majority related to Google Cloud Platform agreements. Just over half of the backlog will convert to revenue in the next 24 months, the company said, with TPU hardware sales beginning to come through as revenue later in 2026, with more in 2027.
Alphabet said its AI model Lyria 3 has generated more than 150 million songs since launching on the Gemini App in mid February, while Nano Banana 2 has created one billion images in nearly half the time of Nano Banana 1. Alphabet reported it now serves 350 million paid subscriptions, with YouTube and Google One being the key drivers.
The company raised its full year capital spending guidance by five billion dollars to 180 billion to 190 billion dollars, following the recent acquisition of Intersect, which provides data centre and energy infrastructure.
Noting that its strong results "reinforce its conviction" to invest to capture the AI opportunity, Alphabet said it expects its 2027 capex to be significantly higher than in 2026.
Alphabet's self-driving unit, Waymo, is now operating in 11 US cities and is delivering 500,000 "fully autonomous" rides per week, doubling in less than a year. The company's Wing drone delivery service "continues to expand across the US in partnership with Walmart and Doordash." Source: Alphabet earnings.
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