Q3 FY2026
Filed Oct 28, 2026Alphabet revenues increased 25% to $127.6 billion, while Google Cloud revenues increased 103% to $30.7 billion.
Revenue growth accelerated to 25%, supported by 11% Google Services growth and 103% Google Cloud growth. Operating income increased 30% to $40,576 million, although net income available to common stockholders was lower than the prior-year quarter following an $8,664 million loss on equity securities.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Q3 2026 total revenuesGAAP | $127.6B | 6% | 25% |
| Q3 2026 constant currency revenuesnon-GAAP | $128.1B | 7% | 25% |
| Q3 2026 revenues excluding hedging effectother | $127.4B | 6% | 24% |
| Q3 2026 hedging gains (losses)GAAP | $194M | – | – |
| Q3 2026 cost of revenuesGAAP | $51.42B | – | – |
| Q3 2026 research and developmentGAAP | $20.64B | – | – |
| Q3 2026 sales and marketingGAAP | $8.80B | – | – |
| Q3 2026 general and administrativeGAAP | $6.14B | – | – |
| Q3 2026 total costs and expensesGAAP | $87.00B | – | – |
| Q3 2026 income from operationsGAAP | $40.58B | – | 30% |
| Q3 2026 operating marginGAAP | 32% | – | – |
| Q3 2026 other income (expense), netGAAP | −$8.22B | – | – |
| Q3 2026 income before income taxesGAAP | $32.35B | – | – |
| Q3 2026 provision for income taxesGAAP | $5.89B | – | – |
| Q3 2026 net incomeGAAP | $26.47B | – | – |
| Q3 2026 preferred stock dividendsGAAP | $298M | – | – |
| Q3 2026 net income available to common stockholdersGAAP | $26.17B | – | – |
| Q3 2026 basic net income per common shareGAAP | $2.14 | – | – |
| Q3 2026 diluted net income per common shareGAAP | $2.12 | – | – |
| Q3 2026 diluted shares used in net income per common share calculationGAAP | 12.37B | – | – |
| Year to date September 30, 2026 revenuesGAAP | $357.3B | – | – |
| Year to date September 30, 2026 income from operationsGAAP | $121.0B | – | – |
| Year to date September 30, 2026 net income available to common stockholdersGAAP | $200.9B | – | – |
| Year to date September 30, 2026 diluted net income per common shareGAAP | $16.33 | – | – |
| Q3 2026 total traffic acquisition costsGAAP | $16.37B | – | – |
| Q3 2026 number of employeesother | 204,757 | – | – |
| Q3 2026 net cash provided by operating activitiesGAAP | $42.29B | – | – |
| Q3 2026 purchases of property and equipmentGAAP | −$51.35B | – | – |
| Q3 2026 free cash flownon-GAAP | −$9.06B | – | – |
| TTM Q3 2026 free cash flownon-GAAP | $19.75B | – | – |
| Q3 2026 net cash used in investing activitiesGAAP | −$71.35B | – | – |
| Q3 2026 net cash provided by financing activitiesGAAP | $29.44B | – | – |
| Q3 2026 interest incomeGAAP | $1.77B | – | – |
| Q3 2026 interest expenseGAAP | −$967M | – | – |
| Q3 2026 loss on equity securities, netGAAP | −$8.66B | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Google ServicesLed by 12% growth in Google Search & other. | $96.30B | – | 11% |
| Google CloudStrong growth in Google Cloud Platform across enterprise AI infrastructure, enterprise AI solutions, core GCP services, and meaningful TPU systems sales. | $30.71B | – | 103% |
| Other BetsRevenues are generated primarily from the sale of autonomous transportation services and internet services. | $372M | – | – |
Capital returns
- Q3 2026 repurchases of stock: $0 million.
- Q3 2026 dividend payments on preferred and common stock: $(2,936) million.
- In October 2026, the Board declared a quarterly cash dividend of $15.63 per share on each Series A and Series B mandatory convertible preferred stock, equivalent to approximately $0.78 per share on each Series A and Series B Depositary Shares.
- In October 2026, the Board declared a quarterly cash dividend of $0.22 per share on Class A, Class B, and Class C stock.
- During the three months ended September 30, 2026, Alphabet issued 12 million shares of Class A stock for net proceeds of $4.3 billion and 24 million shares of Class C stock for net proceeds of $8.1 billion.
- As of September 30, 2026, $27.6 billion remained available for future issuance under the ATM Program.
What drove it
- Google Search & other revenue was $63,350 million, compared with $56,567 million in the prior-year quarter.
- YouTube ads revenue was $11,207 million, compared with $10,261 million in the prior-year quarter.
- Google advertising revenue was $82,012 million, compared with $74,182 million in the prior-year quarter.
- Google subscriptions, platforms, and devices revenue was $14,290 million, compared with $12,870 million in the prior-year quarter.
- The year-over-year Search query growth rate was the highest it has been in the last five years.
- First-party model APIs were processing nearly 32 billion tokens per minute, more than four times what was processed a year ago.
- The Gemini app reached one billion users.
- Alphabet surpassed 150 million YouTube Music and Premium subscribers globally, including trials.
Concerns
- Q3 2026 other income (expense), net was $(8,221) million, compared with $12,759 million in the prior-year quarter.
- The $8.7 billion net effect of the loss on equity securities decreased the provision for income tax, net income, and diluted net income per common share by $1.9 billion, $6.7 billion, and $0.55, respectively.
- Q3 2026 free cash flow was $(9,065) million as purchases of property and equipment were $(51,355) million.
- Other Bets operating loss was $(2,047) million, compared with $(1,426) million in the prior-year quarter.
- Alphabet-level activities operating loss was $(7,655) million, compared with $(4,467) million in the prior-year quarter.
What to watch
- Google Cloud demand across enterprise AI infrastructure, enterprise AI solutions, core GCP services, and TPU systems sales.
- The level of purchases of property and equipment, which were $(51,355) million in Q3 2026.
- Volatility in other income (expense), net from debt and equity securities.
- Google Services growth, including Google Search & other, YouTube ads, and Google subscriptions, platforms, and devices.
- The effect of shared AI research and development expenses included in Alphabet-level activities.
Balance sheet and cash flow
- Cash and cash equivalents as of September 30, 2026: $56,334 million.
- Marketable securities as of September 30, 2026: $208,764 million.
- Total cash, cash equivalents, and marketable securities as of September 30, 2026: $265,098 million.
- Long-term debt as of September 30, 2026: $125,102 million.
- Total assets as of September 30, 2026: $1,003,312 million.
- Total liabilities as of September 30, 2026: $325,763 million.
- Total stockholders’ equity as of September 30, 2026: $677,549 million.
- In the third quarter of 2026, Alphabet issued senior unsecured notes for net proceeds of $28.7 billion.
- Q3 2026 purchases of marketable securities: $(39,987) million.
- Q3 2026 maturities and sales of marketable securities: $21,820 million.
- Q3 2026 purchases of non-marketable securities: $(2,109) million.
- Q3 2026 acquisitions, net of cash acquired, and purchases of intangible assets: $(406) million.
- Q3 2026 proceeds from issuance of debt, net of costs: $28,996 million.
- Q3 2026 repayments of debt: $(3,626) million.
- Cash and cash equivalents at September 30, 2026: $56,334 million.
Analysis
Alphabet reported Q3 2026 revenue of $127,577 million, up 25% from $102,346 million in the prior-year quarter and up 6% from $119,796 million in the quarter ended June 30, 2026. Constant currency revenue was $128,085 million, with reported constant currency growth of 25% year over year and 7% quarter over quarter. The release characterized the result as Alphabet’s 13th consecutive quarter of double-digit revenue growth.
Google Services generated $96,302 million of revenue, compared with $87,052 million in the prior-year quarter. Google Search & other revenue was $63,350 million, YouTube ads revenue was $11,207 million, and Google subscriptions, platforms, and devices revenue was $14,290 million. Management attributed Google Services performance to 12% growth in Google Search & other and said the year-over-year Search query growth rate was the highest in the last five years.
Google Cloud was the central growth contributor, with revenue of $30,709 million versus $15,157 million in the prior-year quarter. Segment operating income was $11,121 million, compared with $3,594 million. Alphabet cited enterprise AI infrastructure, enterprise AI solutions, core GCP services, and TPU systems sales as drivers. Google Services operating income rose to $39,157 million from $33,527 million, while Other Bets recorded an operating loss of $(2,047) million and Alphabet-level activities recorded an operating loss of $(7,655) million.
Consolidated income from operations was $40,576 million, compared with $31,228 million, and operating margin was 32%, compared with 31%. Net income available to common stockholders was $26,170 million and diluted net income per common share was $2.12, versus $34,979 million and $2.87 in the prior-year quarter. Other income (expense), net was $(8,221) million, including an $(8,664) million loss on equity securities. The release states that the net effect of this loss decreased net income by $6.7 billion and diluted net income per common share by $0.55.
Cash generation was constrained by investment levels. Net cash provided by operating activities was $42,290 million, while purchases of property and equipment were $(51,355) million, producing non-GAAP free cash flow of $(9,065) million. Alphabet ended the period with $265,098 million of cash, cash equivalents, and marketable securities and $125,102 million of long-term debt. During the quarter, the company issued senior unsecured notes for net proceeds of $28.7 billion, issued Class A and Class C stock for stated net proceeds, made no stock repurchases, and paid $(2,936) million of preferred and common dividends. No forward financial guidance was provided in the filing.
Management, verbatim
We had a strong quarter and are now on a half-trillion dollar revenue run rate. Our deep full stack approach is driving momentum across the business, with Alphabet revenues growing 25% year-over year. Our AI investments are driving overall Search query growth, including commercial queries. In fact, our year-over-year query growth rate is the highest it’s been in the last five years. Google Cloud revenues grew 103%, powered by huge demand for our AI infrastructure and AI solutions. We’re also seeing strong demand for our TPU systems across a wide range of customers.
Sundar Pichai, CEO of Google and Alphabet
Not in the filing
stated, not guessed- Forward financial guidance.
- Prior guidance for comparison.
- Gross margin.
- Non-GAAP operating income.
- Non-GAAP net income.
- Non-GAAP EPS.
- Tax rate.
- Q3 2026 total revenue gross margin.
- Prior-quarter operating income, operating margin, net income, EPS, operating cash flow, and cash flow line-item comparisons.
- Segment revenue quarter-over-quarter changes for Google Services, Google Cloud, and Other Bets.
- Year-over-year changes for Other Bets revenue and segment operating income or loss.
- A named CFO commentary section.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was checked against the filing text, and a metric whose value, prior period and change do not add up is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.