Alphabet’s Pricey AI Bet Pays Off With Cloud, Search Growth
Google parent Alphabet Inc. is showing an expensive foray into artificial intelligence is starting to pay off, delivering better-than-expected sales for its cloud-computing business and driving more usage of its flagship search engine.
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Revenue, excluding partner payouts, jumped 16% to $74.6 billion from a year ago, the company said in a statement Tuesday, surpassing analysts’ estimates. Third-quarter net income of $2.12 per share also far exceeded projections.
The strong beats worked to allay investor concerns that the company had squandered an early lead in AI and that its massive investments to catch up to the likes of Microsoft Corp. and OpenAI may fail to deliver.
As its main search business matures, Google is betting on growth from its cloud division, which supplies computing power, software and services to other companies. Google is drawing more cloud customers using its AI expertise to gain ground on larger rivals Amazon.com Inc
“In cloud, our AI solutions are helping drive deeper product adoption with existing customers, attract new customers and win larger’
