Google Stock (GOOG) Hits All-Time High as Google Cloud and AI Growth Lift Q1 Earnings

Alphabet’s Google (GOOG) stock is trading at $369, up 6% at press time after climbing to a new all-time high today after the Google parent reported first-quarter earnings that beat Wall Street expectations and showed stronger demand across cloud computing, search advertising, and artificial intelligence products.

Shares of Alphabet’s Class C stock reached an intraday record of $374.22, above the previous closing high of about $350.34 set earlier in the week. The move pushed Alphabet’s market value to about $4.4 trillion, more than double its level from a year ago.

The rally followed a first-quarter report that showed revenue rising 22% year over year to $109.9 billion. Net income reached $62.58 billion, or $5.11 per share, compared with analyst expectations near $2.62 per share. The profit figure included a large gain from non-marketable equity securities, but operating results also improved, with operating income reaching $39.7 billion.

Google Cloud Leads Alphabet’s Earnings Beat

Google Cloud was the strongest driver of Alphabet’s quarter. Revenue in the division rose 63% year over year to $20.03 billion, well above market expectations near $15.3 billion.

The growth was tied to enterprise demand for AI infrastructure, cloud services, and Google’s generative AI tools. Alphabet said Google Cloud’s contracted backlog reached about $460 billion by the end of the quarter, nearly double the previous quarter’s level.

Source: X

The backlog figure shows that major companies are committing more spending to AI infrastructure and cloud services. Google Cloud also recorded a sharp increase in operating income, showing that the division is contributing more to Alphabet’s overall profitability.

CEO Sundar Pichai said demand for Google’s AI models and cloud products continued to expand, with several large customer contracts signed during the quarter.

Search and Gemini Keep Growing

Alphabet’s core Search business also remained strong. Search revenue rose 19% year over year, easing concerns that AI chatbots could weaken Google’s main advertising engine.

The company said AI-powered search features are increasing user engagement rather than reducing search activity. Search queries reached a record level during the quarter, supported by new AI tools inside Google’s search experience.

Alphabet also reported growth in Gemini-related products. Its paid subscription base reached 350 million globally, led by YouTube Premium and Google One. Gemini Enterprise paid monthly active users grew 40% from the previous quarter.

The company said its AI models are now processing more than 16 billion tokens per minute through direct API use, up 60% from the prior quarter.

AI Spending Remains a Key Investor Focus

Alphabet raised its 2026 capital expenditure outlook to as much as $190 billion. The spending will focus mainly on data centers, AI chips, networking infrastructure, and cloud capacity.

The company spent $91 billion on capital expenditures in 2025, and management said spending could increase again next year. The higher budget reflects Alphabet’s effort to keep pace with enterprise demand for AI services.

Investors are watching whether AI revenue growth can continue justifying the cost of infrastructure expansion. Alphabet’s latest results gave markets evidence that the spending is supporting growth, particularly in Google Cloud.

The board also raised the quarterly dividend to $0.22 per share, payable on June 15 to shareholders of record as of June 8.