Alphabet Revenue and Profit Miss Expectations, AI Returns Under Pressure

Shenchao TechFlow report, Oct. 29, according to Jin10 Data, Alphabet, Google's parent company, reported quarterly revenue and profit both below market expectations, indicating the company has not yet generated sufficient returns from its artificial intelligence business to justify its massive investments.

Alphabet said that for the three months ended Sept. 30, revenue was $111.2 billion after excluding payments to partners, and net income per share was $2.12, both below Wall Street expectations. To build artificial intelligence infrastructure for itself and its customers, the company's capital expenditures rose to a record high.

Alphabet said these investments have helped it become one of the top suppliers of computing power to artificial intelligence companies such as Anthropic and Meta, and the company is also developing its own artificial intelligence models and integrating them into products such as its search engine, YouTube and Gmail. However, relative to the scale of spending, these efforts have not yet delivered commensurate returns, and Alphabet shares fell as much as 7.9% in after-hours trading.

Source: Shenchao TechFlow