Alphabet Inc. (GOOGL) reported first-quarter adjusted earnings per share of $2.34 on Wednesday after the close, beating the $2.18 consensus by nearly 8%, as the AI search transition continued to deliver while Google Cloud reasserted its growth credentials. Total revenue of $98.7 billion edged the $96.4 billion estimate; net income of $28.6 billion was 22% higher than year-ago.
Google Search & other revenue grew 14% to $54.0 billion, marginally ahead of the 13% consensus and dispelling persistent concerns that AI Overviews would cannibalize ad clicks. CFO Anat Ashkenazi said on the call that AI Overviews now serve more than 2.4 billion users monthly, up from 2.0 billion in the December quarter, and that monetization rates on AI Overview-equipped queries are "broadly in line" with traditional search results.
Cloud Reignites
Google Cloud Platform delivered the standout print: revenue rose 33% year-on-year to $14.6 billion versus the $13.7 billion consensus, with operating margin expanding to 18.8% from 11.4% a year ago. The Cloud business is now on a $58 billion annualized run-rate. Ashkenazi noted that Cloud backlog reached a record $112 billion, up 41% year-on-year, with $58 billion expected to be recognized within 12 months.
YouTube ads delivered $11.2 billion of revenue, up 17% year-on-year, with management citing strong demand for the Shorts ad format and the YouTube Music & Premium subscription book passing 130 million paid members globally. Google Services overall — which includes Search, YouTube and Network — grew 13.4% to $86.1 billion. Capex came in at $19.8 billion, up 56% year-on-year, with full-year guidance reaffirmed at "approximately $80 billion."
Stock Reaction
Alphabet shares rose 6.2% in extended trade to $204.30, adding more than $145 billion of market capitalization. Class B shares (GOOG) tracked higher in parallel. The print boosted the broader AI ad-tech complex: The Trade Desk (TTD) rose 3.4%, AppLovin (