Alphabet reports strong Q2 growth as Google Cloud, YouTube advertising revenue rise

Google Cloud revenue rose 82% year on year to $24.77 billion for the quarter, exceeding analysts’ expectations of $24.56 billion and increasing from $13.6 billion during the same period last year.

The company’s overall advertising revenue also surpassed expectations, reaching $81.63 billion compared with an anticipated $81.12 billion.

YouTube generated more than $11 billion in advertising revenue between April and June, representing a 13% year-on-year increase. Google CEO Sundar Pichai attributed part of the growth to increased interest around the 2026 FIFA World Cup, saying related videos attracted more than 1.7 billion unique viewers.

Data shared with Digital Music News also indicated continued subscriber growth for YouTube Music, although the company has not yet released detailed figures for the first half of 2026.

“Q2 was an amazing quarter, with Alphabet revenues growing 24% year over year and Google Cloud revenues accelerating to 82% growth, driven by demand for AI infrastructure and AI solutions,” Pichai said. “We have exciting momentum across the board.”

Pichai also said nearly 90% of Fortune 100 companies were using Gemini Enterprise and reported strong demand for Google's security products.

Despite the company’s strong financial performance, Alphabet continues to face investor concerns over the high cost of developing artificial intelligence infrastructure. Technology companies are investing heavily in data centres and specialised chips as demand for computing capacity continues to grow.

Google is also under pressure to maintain its position in the increasingly competitive AI market by developing more advanced models. Bloomberg recently reported that the company had delayed its Gemini 3.5 Pro model over concerns about its performance compared with rival systems, a claim Google has rejected.

“We’re shipping quickly across a wide range of models while keeping them highly cost-effective for customers,” a Google spokesperson said. “We’re currently testing 3.5 Pro, an upgraded Flash model, and other models with partners, and we're productively engaged with the U.S. government.”

Alphabet’s shares have also continued to perform relatively strongly compared with those of some of its technology competitors, rising by about 4% over the past three months, although they remain below their previous 52-week high.