Google Q3 2026: Cloud revenue doubles while a big loss drags EPS
As seen on the 24/7 Wall St. homepage on October 28, 2026.
Google Cloud revenue doubled, up 103% year over year on AI infrastructure and TPU sales, which is what matters for investors here. The EPS miss came from an $8.7 billion loss on equity securities, and quarterly capex of $51.4 billion pushed free cash flow negative. Keep an eye on the stock as the call gets underway.
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Alphabet's Q3 2026 GAAP earnings per share came in at $2.12, missing expectations against the $3.003 consensus. Nearly all of that gap traces to an $8.7 billion loss on equity securities, versus a gain a year earlier.
Google Cloud posted revenue of $30.7 billion, up 103% year over year, powered by enterprise AI infrastructure, AI solutions, and TPU system sales. Operating income in the segment more than tripled from the same quarter a year ago. That margin expansion is what investors will focus on.
The cost of that growth is real: capital expenditures reached $51.4 billion in the quarter, pushing free cash flow negative. Alphabet funded the build-out with senior unsecured notes and an at-the-market equity program.
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Total revenue grew 24.6% year over year to $127.6 billion, roughly in line with estimates. CEO Sundar Pichai noted that Search query growth is at its highest rate in five years and that the Gemini app has reached one billion users, the fastest-growing product in Google's history.
This result snapped a 12-quarter streak of beating consensus EPS estimates. The equity loss and the scale of capex both repeat or reverse in future quarters, moving reported earnings either way. The earnings call on October 28 will set the stock's next move.