Live Live update #6

Alphabet’s Bull vs Bear Case Following Q3 Results

From live coverage: Live: Will Alphabet Smash Q3 Earnings Tonight After the Market Closes?
GOOGL
Google

Thesis check


weakening$324.89 +1.3% today
“Alphabet's AI spending converts into cloud growth fast enough to offset search erosion”

Bull case
  • Google Cloud revenue of $30.71B beat the $29.1B expected, the one line that landed above the bar
  • Cloud growth of 103% year over year shows AI infrastructure demand still compounding
  • Capital spending is funding the only segment currently outrunning estimates
Bear case
  • Google Search revenue of $63.35B missed the $64.85B expected, cracking the cash engine that pays for the AI build
  • Google Services at $96.30B fell short of $98.4B expected
  • Total revenue of $127.58B missed the $127.93B consensus
  • EPS of $2.12 against $2.87 a year ago

The search miss is what tips it: cloud can double and still not matter if the segment underwriting the capex budget is slowing. Shares are down 9% following the report. A search reacceleration next quarter, with cloud holding near triple-digit growth, would put the thesis back intact.

Contact [email protected] for any questions or corrections.

More From This Coverage

Newest first

Alphabet Q3 Earnings Coverage Wrap-Up

Thomas Richmond

That wraps up our initial coverage of Alphabet’s Q3 results. Thank you for stopping by!

The Red Flag That Sent Alphabet Down 9% After Earnings

Thomas Richmond
THE WIRE
4:20pm ET

The red flag in Alphabet's Q3 report is that Search revenue of $63.35 billion came in missing expectations of $64.85 billion. Although Cloud posted 103% growth, Alphabet is relying on the Search business as an advertising engine that funds the company. With the stock down 9% after hours, one of the main questions to watch for on the call is whether capex will keep climbing against a softer ad base.

Alphabet's Double Miss Q3 Earnings at a Glance

Thomas Richmond
GOOG
Google

Q3 2026

4:01pm ET

EPS
$2.12
est $3.00
-28.5%

Revenue
$127.58B
est $127.83B
-0.2%

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.

Alphabet Q3 Earnings Are Out - Stock Sinks 7% on Double Miss

Thomas Richmond

Alphabet just reported its Q3 2026 earnings, with shares initially down 7% following the report. Here are the key numbers:

  • Revenue: $127.58B vs. $127.93B expected
  • EPS: $2.12 vs. $2.87 a year ago
  • Google Services Revenue: $96.30B vs. $98.4B expected
  • Google Cloud Revenue: $30.71B vs. $29.1B expected
  • Google Search Revenue: $63.35B vs. $64.85B expected
  • YouTube Ads Revenue: $11.21B vs. $11.43B expected
  • Operating Income: $40.58B vs. $43.16B expected
  • Capital Expenditures: $51.36B vs. $55.78B expected

Quick Read:

  • Revenue Miss: Alphabet missed Wall Street’s revenue expectations, with weaker-than-expected Search, YouTube, and Google Services revenue weighing on results.
  • Cloud Strength: Google Cloud revenue beat expectations by around $1.61 billion, but the strong performance wasn’t enough to offset broader weakness and concerns about profitability.

Alphabet's Technical Setup Ahead of Q3 Earnings Tonight

Thomas Richmond
GOOGL
Google

Technical setup

3:30pm ET

Support & resistance · chart through Wed, Oct 28
  • R2$361.79+11.8%
  • R1$351.58+8.6%
  • Now$323.71
  • S1$314.90-2.7%
50-day avg
$341.49-5.2% below
200-day avg
$341.19-5.1% below
52-week range
$251.85 – $408.61

At $323.71, Alphabet heads into tonight's earnings below both its 50-day ($341.49) and 200-day ($341.19) averages, which sit almost on top of each other and form one thick ceiling just above. Support at $314.90 is the level that matters if the reaction disappoints, with $351.58 the first resistance a strong report would have to clear.

Polymarket: 34% Odds That Alphabet Beats Earnings Tonight

Thomas Richmond
GOOGL
Google

Prediction markets

3:25pm ET

Will Google (GOOGL) beat quarterly earnings?
34%Yes
Polymarket · $15k traded · resolves Wed, Oct 28

Polymarket traders price just a 34% chance that Alphabet's GAAP EPS tops expectations in tonight's earnings report. Options activity points the other way, with call buyers dominating ahead of the report, so one of the two crowds gets a surprise after the close.

Alphabet Traders Lean Bullish Ahead of Q3 Earnings

Thomas Richmond
GOOGL
Google

Options positioning

3:20pm ET

Put/call 0.55Calls dominant
CallsPuts

ATM implied vol
83.4%
Expiry
Fri, Oct 30chain as of Tue, Oct 27

A 0.55 put/call ratio into tonight's earnings says call buyers dominate and traders are leaning toward upside, though crowded optimism is exactly the setup that disappoints when a quarter lands soft. The 83.4% at-the-money implied volatility on the October 30 expiration shows how much movement is priced in, with call open interest stacked at the 325 and 327.5 strikes and puts clustered at 315 and 320.

Open interest near the money · puts / calls
  • $315

    3.5k / 1k

  • $317.5

    1.2k / 917

  • $320

    3.4k / 1.5k

  • $322.5

    1.1k / 820

  • $325

    2.7k / 5.2k

  • $327.5

    710 / 3.5k

Alphabet Is Down Over 20% From Highs. Is a Massive Rebound Coming?

Thomas Richmond

Alphabet is set to report its Q3 2026 earnings after the market closes today, with investors closely watching whether its massive AI investments are beginning to pay off.

Google Cloud grew an impressive 82% last quarter, and investors will be looking for continued momentum as demand for AI infrastructure accelerates.

However, that growth comes at a significant cost. Alphabet’s capital spending doubled to $44.92 billion last quarter, pushing free cash flow into negative territory.

Wall Street expects EPS of $3.0030, while GOOGL shares have fallen 5.88% over the past month.

The big question tonight is whether Alphabet can sustain its explosive Cloud growth while showing signs that its enormous AI investments will eventually translate into stronger cash flow.

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