Alphabet's Q1 earnings shattered analyst expectations, sending the stock soaring. Google's CEO credits its AI efforts.

• Alphabet reported its 2025 first-quarter results on Thursday.
• Google CEO Sundar Pichai credited an "unique full stack approach to AI" for "strong Q1 results."
• Revenues mostly exceeded initial estimates, except for Google Cloud, which once again fell short.

Alphabet, the parent company of Google and YouTube, reported its first-quarter earnings Thursday after the market close, exceeding initial revenue estimates, sending shares up.

Alphabet Inc., comprised of Google and a collective of companies called Other Bets, reported its first-quarter earnings results during a conference call on Thursday.

Google CEO Sundar Pichai said in a statement that the company's "strong Q1 results, which reflect healthy growth and momentum across the business," reflect its "unique full stack approach to AI."

"This quarter was super exciting as we rolled out Gemini 2.5, our most intelligent AI model, which is achieving breakthroughs in performance and is an extraordinary foundation for our future innovation," said Pichai in the earnings report. "Search saw continued strong growth, boosted by the engagement we're seeing with features like AI Overviews, which now has 1.5 billion users per month."

Investors tuning in to the earnings call are likely listening for updates on Alphabet's cloud business, which has become a vehicle for its pursuits in artificial intelligence. Slowed Cloud business growth in the past and a larger-than-expected capex forecast for 2025 had sent Alphabet's shares down over 8% in February.

Despite seeing 28% of year-on-year growth compared to the first quarter in 2024, Google Cloud still became one of the two revenue streams that fell short of initial estimates in the first quarter of 2025.

Thomas Monteiro, senior analyst at Investing.com, said in a note that Alphabet has "delivered a sound response to those questioning the solidity of the search business" amid increasing AI demand.

"When you combine the numbers seen today with Alphabet's also solid cloud performance, it leaves few doubts about the company's leading position in the AI search revolution," said Monteiro.

Here are the key numbers for the fourth quarter compared to analysts' estimates compiled by Bloomberg:

• Earnings per share: $2.81 vs. $2.01 expected
• Revenue: $90.23 billion vs. $89.1 billion expected
• Google advertising revenue: $66.89 billion vs. $66.39 billion expected
• YouTube advertising revenue: $8.93 billion vs. $8.94 billion expected
• Google Cloud revenue: $12.26 billion vs. $12.31 billion expected

Thursday's earnings call also comes as Alphabet navigates increased scrutiny from federal regulators. The Justice Department and several states filed an antitrust lawsuit against Google in 2020. Four years later, a federal judge ruled that Google spent billions to make its search engine the default on iPhones, Android devices, and web browsers.

"After having carefully considered and weighed the witness testimony and evidence, the court reaches the following conclusion: Google is a monopolist, and it has acted as one to maintain its monopoly," District Judge Amit Mehta wrote.

This month, Judge Leonie Brinkema of the US District Court for the Eastern District of Virginia ruled that Google holds an illegal monopoly in specific online advertising markets.

Brinkema wrote in her ruling that the Justice Department and states that filed an antitrust lawsuit against Google proved the company "willfully engaged in a series of anticompetitive acts to acquire and maintain monopoly power in the publisher ad server and ad exchange markets for open-web display advertising."

"For over a decade, Google has tied its publisher ad server and ad exchange together through contractual policies and technological integration, which enabled the company to establish and protect its monopoly power in these two markets," Brinkema wrote.

Google and the Justice Department are now in the middle of a remedies trial related to the search engine ruling. Both parties will make arguments before a judge determines the appropriate market remedy. Google, for its part, is trying to avoid being forced to divest certain products, like the Chrome browser.