Alphabet Inc. (GOOGL.O) posted a sharp rise in Google Cloud revenue for the July-September quarter, signaling robust growth in the market for AI-powered computing services. The 35% surge in revenue, the fastest growth Alphabet has seen in eight quarters, outpaced analysts’ expectations of a 29% rise, according to data from LSEG.
The strong performance lifted Alphabet’s stock by 5.5% in premarket trading on Wednesday, reflecting investor confidence in the tech giant’s capacity to meet the rising demand for advanced cloud solutions. Alphabet’s cloud growth bodes well for top competitors Microsoft (MSFT.O) and Amazon.com (AMZN.O), both of which have substantial investments in AI-focused cloud infrastructure.
Analysts say the results underscore a trend in the cloud sector, where AI capabilities are increasingly seen as essential for businesses seeking to enhance productivity and decision-making. As enterprises look to harness AI’s potential, the demand for cloud-based AI computing is expected to continue accelerating, bolstering Alphabet’s position among cloud service providers.
The latest figures position Google Cloud as a major player in the AI-aided computing market, adding momentum to Alphabet’s efforts to diversify beyond its core advertising revenue streams.
