Alphabet becomes first company to report $100B quarterly profit
What's the story
Google-parent Alphabet has become the first company in history to report over $100 billion in quarterly profit. The achievement was recorded in the company's second-quarter earnings report released on July 22. The tech giant posted a net income of $112.1 billion, nearly four times what it earned last year during the same period.
Record-breaking earnings
More than total annual revenue of 459 Fortune 500 companies
The $112.1 billion net income posted by Alphabet is more than the total annual revenue generated by 459 Fortune 500 companies.
The record-breaking earnings were bolstered by an 82% increase in Google Cloud revenue and a year-over-year rise of 24% in Alphabet's overall revenue, which reached $119.8 billion.
Strategic alliances
Gains from investments in AI firm Anthropic, SpaceX
The record earnings were also fueled by huge gains from Alphabet's investments in AI firm Anthropic and Elon Musk's SpaceX.
A footnote in the company's Q2 earnings release revealed that much of the record profit came from $99 billion in "other income," including "unrealized and realized gains" from its investment portfolio.
These gains contributed $77.1 billion to its net income after taxes, largely due to Alphabet's stakes in Claude-maker Anthropic and Elon Musk-owned space company SpaceX.
Investment growth
Alphabet's investment and partnership with Anthropic, SpaceX
In 2023, Alphabet invested $300 million in Anthropic, which has grown significantly since then. The companies have a cloud partnership where Anthropic has committed to purchasing large amounts of computing capacity from Google Cloud.
This deal has contributed to the rapid growth of Google's cloud business.
Similarly, Alphabet holds a nearly 6% stake in SpaceX, which went public last month at a valuation of $1.77 trillion.
Market reaction
Alphabet shares fell by about 3% in after-hours trading
Despite the record-breaking earnings, Alphabet shares fell by about 3% in after-hours trading.
The decline was due to investor concerns over the company's increasing expenditure on AI infrastructure to up to $205 billion in 2026 and mounting competition for its Gemini family of AI models.