Alphabet is set to report third-quarter earnings after the bell Wednesday.
Here’s what analysts are expecting according to LSEG consensus:
- Revenue: $99.89 billion
- Earnings per share: $2.33
Wall Street is also watching several other numbers in the report:
- YouTube advertising revenue: $10.01 billion, according to StreetAccount
- Google Cloud revenue: $14.74 billion, according to StreetAccount
- Traffic acquisition costs (TAC): $14.82 billion, according to StreetAccount
As Alphabet reports its latest results, Wall Street expects the search giant to show 13% year-over-year revenue growth.
The company’s stock price soared 38% in the third quarter, its best quarterly performance in two decades. It’s continued to rally, climbing 11% so far in October, topping off a quarter full of artificial intelligence product announcements and a regulatory win.
Alphabet’s biggest win came when U.S. District Judge Amit Mehta in September ruled against the most severe antitrust consequences that were proposed by the Department of Justice. That would’ve included the forced sale of Google’s Chrome browser, which provides data that helps its advertising business deliver targeted ads.
Mehta dedicated roughly 30 pages of the 226-page filing to explaining generative AI and the market as “highly competitive,” and wrote that there have been “numerous new market entrants,” creating some concern about Google’s ability to compete in AI. However, Mehta’s decision to let Google keep Chrome with little reprimand, sent shares soaring.
After the big rally, President Donald Trump congratulated Google executives at a dinner in Washington. The ruling continued to rally investors the following days, pushing the company into the $3 trillion market capitalization club — territory occupied only by Nvidia, Microsoft and Apple.
During the quarter, the search giant also faced off with the DOJ again in a separate remedies trial for its ad tech monopoly case. In legal filings, Google’s lawyers conceded that the open web was in a “rapid decline,” sending a wave of reactions. Google later walked back the statement. Closing arguments are scheduled for late November.
In August, Google announced its new lineup of AI-powered Pixel 10 smartphone series to rival Apple’s iPhone, and launched a widespread advertising campaign poking fun at the iPhone maker.
Alphabet shares rose in August after reports that Google is in talks to incorporate its Gemini technology for a revamped version of Apple’s Siri voice assistant. Gemini has been atop AI performance benchmarks but has lower usage compared with OpenAI’s ChatGPT. Meanwhile, Apple is also exploring partnerships with Anthropic and OpenAI as it tries to renew its AI road map, according to reports.
In September, Google’s Gemini app took the top spot on Apple’s App Store, dethroning ChatGPT. That came after the company introduced the image editing feature Nano Banana with its “Flash” AI model. The app allows users to blend multiple photos together and use prompts to create things such as digital figurines of themselves based on photos they upload.
Google in September began adding its Gemini AI chatbot to Chrome for Mac and Windows users in the U.S. That feature allows users to ask Gemini for help understanding the contents of a particular webpage, work across tabs or do more within a single tab, such as schedule a meeting or search for a YouTube video.
In October, the company launched Gemini Enterprise, targeting corporate clients with agents that perform specific work tasks. Google CEO Sundar Pichai also said at Salesforce’s Dreamforce conference that Gemini 3, the latest version of the company’s AI model, will be released this year.
During the quarter, Alphabet continued reducing head count to streamline the company as it seeks to prioritize investment in AI.
The company eliminated more than one-third of its managers overseeing small teams compared with a year ago, CNBC reported in September. The company also laid off more than 100 design-related roles from its cloud division during the quarter. Additionally, Google cracked down on some of its remote work policies and pushed employees to use more AI tools in their day-to-day work.
Alphabet’s self-driving car unit Waymo also had a number of announcements during the quarter.
In August, Waymo said that it obtained permits to begin testing its autonomous vehicles with trained safety drivers on board in New York City.
In September, Waymo was cleared to begin testing driverless rides at the San Jose Mineta International Airport in San Jose, California, with plans to offer paid rides at the airport later this year, in time for Super Bowl LX and the 2026 FIFA World Cup. That month, Waymo also received clearance to test its robotaxis at San Francisco International Airport. This month, it announced plans to bring its robotaxi services to London, its first European destination.
Google also changed its tone in fact-checking for its video platform YouTube. As a part of the shift, the company’s YouTube division said in September that it would soon allow accounts that were previously banned for spreading misinformation related to Covid-19 and the 2020 U.S. election to apply for reinstatement. In a letter submitted to Congress in September, the company’s lawyers touted “free expression” and vowed to avoid fact-checking.
YouTube began allowing those accounts to apply for reinstatement in October.
WATCH: Google has to show it’s protecting search this earnings season, says G Squared’s Victoria Greene
