AI investment paying off for Google, according to latest Alphabet earnings call

Google’s parent company Alphabet announced strong Q2 2025 earning this week. The update reported earnings surpassing analyst expectations with a profit of $28.2 billion on $96.4 billion in revenue.

Make it stand out

A key takeaway was the impact of AI investment in recent years, which CEO Sundar Pichai stated is "positively impacting every part of the business”.

Google Cloud was a standout performer, increasing revenue by 32% to $13.6 billion, driven by significant demand for its AI infrastructure and solutions.

Revenue from Google search reportedly grew by double digits to $54bn, with the call reporting AI overviews now have over 2 billion monthly users across 40 languages. Within YouTube, ad revenue continued on its upward trajectory along with subscription growth, growing revenue to $9.8bn.

The company also announced a substantial increase in capital expenditure for 2025, reaching approximately $85 billion, primarily to bolster its AI and cloud capabilities, signalling aggressive investment in this pivotal technology.

What this means for Irish advertisers?

Given Google investment data is not included in ad spend reports from Nielsen, these earnings updates are key for advertisers to monitor both for insights on usage and areas of ad spend growth.

New AI-Driven Placements: Ads are appearing within AI Overviews and AI Mode, requiring contextually relevant ad copy for these prominent positions.

Evolving Search Dynamics: AI Overviews could shift organic and paid search click-through rates, demanding continuous monitoring and adaptive strategies.

YouTube Shorts Opportunity: Strong monetization on Shorts offers a significant avenue for short-form video advertising.

Prioritise Relevance: As AI advances, highly relevant and quality creative assets will be key to success.

Read more here: https://apnews.com/article/google-alphabet-quarterly-earnings-artificial-intelligence-7afa082a178c36520dfc7a7621fe2397