Alphabet, the parent company of Google, has crossed the USD 400 billion mark in annual revenues for the first time in 2025, marking a major milestone in the company’s growth journey. The achievement reflects strong momentum across its core businesses, particularly Search, Cloud and artificial intelligence-led products.

According to an ANI report, Google CEO Sundar Pichai described the performance as a “tremendous” quarter, crediting the results to a fundamental expansion in Search and Cloud, powered by the company’s rapidly maturing AI ecosystem. He noted that AI is increasingly driving usage, engagement and business outcomes across Alphabet’s platforms.

Alphabet’s Search business recorded a year-on-year growth of 17 per cent, with the company seeing its highest-ever usage in the fourth quarter. The earnings report highlighted that AI-driven features are creating an “expansionary moment” for Search, helping attract more users and deepen engagement.

Google Cloud emerged as one of the biggest growth engines, with revenues rising 48 per cent to an annual run rate exceeding USD 70 billion. The Cloud backlog grew 55 per cent quarter-on-quarter to USD 240 billion, reflecting strong demand from a broad base of customers, particularly for AI-powered products and services.

The company also reported sharp acceleration in its generative AI business. Revenue from products built on Alphabet’s generative AI models surged nearly 400 per cent year-on-year in the fourth quarter, a significant jump compared to the previous quarter. YouTube continued its strong run as well, with annual revenues crossing USD 60 billion from advertising and subscriptions combined.

On the infrastructure front, Alphabet highlighted major efficiency gains, noting that Gemini serving unit costs were reduced by 78 per cent over 2025 through model optimisation and better utilisation. The launch of Gemini 3 was described as a key milestone, driving tangible business results across the company. The Gemini app now has more than 750 million monthly active users, with engagement levels rising sharply since the December rollout.

Looking ahead, Alphabet signalled an aggressive push to strengthen its infrastructure advantage. The company plans to significantly ramp up capital expenditure in 2026, with investments estimated between USD 175 billion and USD 185 billion, focused largely on expanding data centres and AI computing capacity.