Google-owner Alphabet shares soared in the US premarket on Thursday after the company announced strong Q1 results, driven by AI cloud demand.
Alphabet has delivered a stellar first quarter, with consolidated revenues up 22% (or 19% in constant currency) to $109.9 billion, marking the group’s 11th consecutive quarter of double-digit growth and signalling broad-based momentum across the business.
Google Cloud was the standout, with revenues accelerating 63% to $20 billion as enterprise demand for AI Solutions, AI Infrastructure and core Google Cloud Platform services continues to gather pace.
The scale of that step-up will reinforce the bull case that Alphabet is carving out a credible position in the AI infrastructure race. As well as having one of the strongest LLM offerings with Gemini.
Google Services revenues climbed 16% to $89.6 billion, with Search & other up 19%, subscriptions, platforms and devices also up 19%, and YouTube ads adding a respectable 11%.
Strong showing across the core advertising engine and growing subscription stack suggests the AI shift is, so far, proving additive rather than disruptive.
“Alphabet looks every inch the market darling right now, and investors are rewarding a business that is delivering on both sides of the AI debate: cloud is accelerating hard, while Search is proving far more resilient than many feared,” said Matt Britzman, senior equity analyst, Hargreaves Lansdown.
“It is almost hard to believe that a year ago, Alphabet was being written off by parts of the market as an AI loser, because today it arguably wears the crown as the strongest full-stack AI option in mega-cap tech, with chips, models, cloud infrastructure, consumer reach and advertising all pulling in the same direction. The biggest fear was that AI would disrupt Google Search, but the proof is in the pudding. Search growth has stepped up meaningfully, and investors have flipped the script, from Search as the business most at risk from AI, to one of the clearest beneficiaries.”