Re:Alphabet Announces Third Quarter 2026 Results [pdf]
by cs702 on Wednesday October 28, 2026 @04:30PM
(#50280448)
Impressive growth, and even more, ahem, impressive capital spending :-O
According to page 6, year to date in 2026, operations generated $127B in cash, and capital spending on property and equipment was $132B, so year to date, the business consumed $5B.
According to page 8, in the last quarter, operations generated $42B and capital spending was $51B, so over the past three months, the business consumed $9B.
Those figures don't include any capital spending made through off-balance sheet arrangements. No idea what those might be, or for how much Alphabet could be on the hook.
I'm curious to see if all that money invested in infrastructure will pay off. I hope it pays off, for everyone's sake, but hope is not certainty.
Re:Alphabet Announces Third Quarter 2026 Results [pdf]
by treis on Wednesday October 28, 2026 @04:39PM
(#50280564)
It's a tale of two AIs for Google. Cloud doubled revenue and tripled profit, probably based off serving models. So good for Cloud.
Search increased revenue and profit which is good. Means that LLMs are not yet stealing revenue. But also bad because the massive spend on infrastructure doesn't look like it's going to come back as increased revenue.
Re:Alphabet Announces Third Quarter 2026 Results [pdf]
by Anon1096 on Wednesday October 28, 2026 @05:09PM
(#50280928)
People on the internet really overrate google's TPU advantage. OAI and Anthropic and others have been using TPUs as well for a long time now too. And they've also hired lots and lots of talent from the rest of FAANG, hyperscale compute talent and knowledge is also well distributed through all the top AI companies at this point.
Re:Alphabet Announces Third Quarter 2026 Results [pdf]
by paxy on Wednesday October 28, 2026 @04:31PM
(#50280466)
It's wild how quickly the tide turned from big tech companies having hundreds of billions in cash reserves and not knowing what to do with it to now taking on hundreds of billions in debt for questionable infrastructure buildouts.
Re:Alphabet Announces Third Quarter 2026 Results [pdf]
by gradus_ad on Wednesday October 28, 2026 @04:52PM
(#50280746)
Ironically their massive cash reserves created an environment where the cost of AI infrastructure could be bid up so much to consume those very cash reserves.
Re:Alphabet Announces Third Quarter 2026 Results [pdf]
by eitally on Wednesday October 28, 2026 @11:11PM
(#50284145)
At least in the case of Google, the pace of their buildout is very nearly being matched by the growth of Cloud consumption (and related contracts with companies like Anthropic & OAI). Cloud had >100% y/y growth this quarter to >$30b rev. That's insane, and it's quite profitable. But consumption revenue is always a lagging indicator of capital investment, and it just so happens that this business cycle is demanding a scale of capex heretofore unimaginable. Institutional investors seem to have been happier with business as usual (big annual stock buy-backs, predictable cloud/ads/youtube growth in the high-20% range, EPS in the $5-9/share/qtr range, and an enormous pile of cash). This is the first time since 2004 where buying GOOG really feels like placing a bet rather than buying a blue-chip. To that point, this is also why GOOG has been treated like an AI company for the past 18mo or so, rather than a media & infrastructure company, and what justified the dramatic increase in it's P/E.
Taking a longer view, I have confidence things will work out well and this dip is a great buying opportunity, but I can also understand why the market several reasons to be skittish.
Re:Alphabet Announces Third Quarter 2026 Results [pdf]
by aix1 on Wednesday October 28, 2026 @11:43PM
(#50284324)
Depending on how the next trading day goes, this could be a bit more than "this happens about once quarter". From to the FT:
> Its shares fell more than 10 per cent in after-hours trading[...] The share price drop, if sustained, would wipe more than $400bn from the group’s market value, the largest single-day loss in the company’s history.
Re:Alphabet Announces Third Quarter 2026 Results [pdf]
by paxy on Wednesday October 28, 2026 @04:41PM
(#50280592)
I'm sure Google will end up being one of the winners no matter what but man the market hates the stock. It was trading at 16 p/e before earnings and is now at like 14. Less than half of Microsoft, Apple, Nvidia.
Re:Alphabet Announces Third Quarter 2026 Results [pdf]
by qlte on Thursday October 29, 2026 @02:59PM
(#50294150)
Yes, at any given time like 75% of the front page is about Yet Another AI Model/Tool/Demo/etc.
Sure, the comment threads have varying opinions with a decent share of AI skeptics/critics but also plenty of die hard AI boosters.
It's hard to imagine what an even more pro-AI version of HN would look like whenever I see the meme that "HN hates AI". Unless the hope is for a 100% pro-AI echo chamber (which would be completely detached from the broader controversy about AI among the general public).
Re:Alphabet Announces Third Quarter 2026 Results [pdf]
by lovich on Wednesday October 28, 2026 @05:02PM
(#50280845)
Well it’s currently negatively affecting my life in every aspect other than being an upgrade to searches.
I don’t discount its capabilities since around April of this year, it passed my bar for being able to do amazing things. But it has also made any interaction I’ve had with companies a living nightmare and appears to have permanently deleted my career and knocked me down 1-2 economic classes.
Re:Alphabet Announces Third Quarter 2026 Results [pdf]
by asb-qwer on Wednesday October 28, 2026 @04:45PM
(#50280630)
Ad sales fall because the AI mania has made it clear that Big Tech does not care about humans, so humans go elsewhere.
Advertisers on the other hand are alerted to viewbotting with increasingly sophisticated AI "users".
It was clear already two years ago that the model of AI generated "content" that is watched by AI viewbots does not work. Of course Big Tech has to steam forward and find out the hard way.
Congrats, you have ruined the entire SV business model with your fantasies derived from cheap, horribly written SciFi novels.
Re:Alphabet Announces Third Quarter 2026 Results [pdf]
by HardCodedBias on Wednesday October 28, 2026 @04:49PM
(#50280695)
1. Cloud killed it.
2. Youtube meh, like always (weird that it doesn't kill it)
3. Search -- this was the issue. QonQ 0.1% <-- the whole story
Everyone has expected Search to, sooner or later, crack. This looks like it may be it.
If Google had 30B in revenue from coding tools and a few billion from Gemini Enterprise then there would be a story that Google could get through this.
But GDM didn't execute. And that's that.
Who knows the bottom. More than 10-15% seems unlikely. But if search cracks again next quarter then we'll see a real revaluing of the business.
Google did not have the proper focus on AI. They should have owned the space. But there were clearly management issues.
Re:Alphabet Announces Third Quarter 2026 Results [pdf]
by dada216 on Wednesday October 28, 2026 @06:24PM
(#50281792)
Although Argon hasn't delivered on coding yet I think that it's just the first checkpoint of the new model family since Hassabis, and I think it's promising, so if they can get a few good checkpoints in and then price gauge anthropic they can get that sweet sweet coding tools subscription revenue.
Antigravity is not that bad, pair it with a good model with good limits, ideally slightly cheaper than the X5/x20 sub from Anthropic, and I, for one, would switch.
Re:Alphabet Announces Third Quarter 2026 Results [pdf]
by alex1138 on Wednesday October 28, 2026 @04:52PM
(#50280741)
Youtube has sucked for many years. I just don't know how much Google is responsible for it. Back in 2006, they were dealing with copyright battles (despite the fact they won their lawsuit against Viacom) so Google bought them to help them out with their resources. The site itself has tons of censorship and bad targeting on the recommended videos and I think Neal Mohan has made it even worse the last few years with more and more ads and Shorts and everything
Re:Alphabet Announces Third Quarter 2026 Results [pdf]
by motionlessveloc on Wednesday October 28, 2026 @07:40PM
(#50282496)
One fun line from the results: Google assets are up in one year from $595,281M to $1,003,312M, in other words one trillion dollars. Not market cap, mind you, but assets that could in theory be sold today to raise a trillion dollars in cash.
Liabilities also increased from $180,016M to 325,763M, but in comparison that seems almost puny.
Translation: even Google ... a company that basically has a license to print money (aka Google Search) ... is losing a ton of money on AI.
According to page 6, year to date in 2026, operations generated $127B in cash, and capital spending on property and equipment was $132B, so year to date, the business consumed $5B.
According to page 8, in the last quarter, operations generated $42B and capital spending was $51B, so over the past three months, the business consumed $9B.
Those figures don't include any capital spending made through off-balance sheet arrangements. No idea what those might be, or for how much Alphabet could be on the hook.
I'm curious to see if all that money invested in infrastructure will pay off. I hope it pays off, for everyone's sake, but hope is not certainty.
Search increased revenue and profit which is good. Means that LLMs are not yet stealing revenue. But also bad because the massive spend on infrastructure doesn't look like it's going to come back as increased revenue.
> generating $127B in cash, and capital spending on property and equipment was $132B, so the business consumed $5B.
That’s an amazing amount of revenue and spend, though. Wild.
I meant Datacenter real estate, construction companies, building materials. :)
Taking a longer view, I have confidence things will work out well and this dip is a great buying opportunity, but I can also understand why the market several reasons to be skittish.
> Its shares fell more than 10 per cent in after-hours trading[...] The share price drop, if sustained, would wipe more than $400bn from the group’s market value, the largest single-day loss in the company’s history.
Sure, the comment threads have varying opinions with a decent share of AI skeptics/critics but also plenty of die hard AI boosters.
It's hard to imagine what an even more pro-AI version of HN would look like whenever I see the meme that "HN hates AI". Unless the hope is for a 100% pro-AI echo chamber (which would be completely detached from the broader controversy about AI among the general public).
I don’t discount its capabilities since around April of this year, it passed my bar for being able to do amazing things. But it has also made any interaction I’ve had with companies a living nightmare and appears to have permanently deleted my career and knocked me down 1-2 economic classes.
Advertisers on the other hand are alerted to viewbotting with increasingly sophisticated AI "users".
It was clear already two years ago that the model of AI generated "content" that is watched by AI viewbots does not work. Of course Big Tech has to steam forward and find out the hard way.
Congrats, you have ruined the entire SV business model with your fantasies derived from cheap, horribly written SciFi novels.
https://finance.yahoo.com/technology/article/google-stock-pl...
This right here is the source of most of humanity's upcoming problems.
This isn't true. Meta ad sales and traffic are surging. This is mostly a problem with Google.
2. Youtube meh, like always (weird that it doesn't kill it)
3. Search -- this was the issue. QonQ 0.1% <-- the whole story
Everyone has expected Search to, sooner or later, crack. This looks like it may be it.
If Google had 30B in revenue from coding tools and a few billion from Gemini Enterprise then there would be a story that Google could get through this.
But GDM didn't execute. And that's that.
Who knows the bottom. More than 10-15% seems unlikely. But if search cracks again next quarter then we'll see a real revaluing of the business.
Google did not have the proper focus on AI. They should have owned the space. But there were clearly management issues.
It's a huuuge training set, why would they kill that?
Liabilities also increased from $180,016M to 325,763M, but in comparison that seems almost puny.
Nothing worth a trillion bucks can be sold today. :)
Also, this does include things like property and equipment ($375bn), which I'm guessing are essential for running the business.
That aside, GOOG does hold $265bn in cash and near cash, which in my book is a lot of money.