Google Cloud grew revenue 82% year over year to $24.8 billion in the second quarter of 2026. For a business that size, that is not a growth spurt. That is a sprint.
The Gemini app had its own moment. It reached 950 million monthly active users, up from approximately 450 million a year earlier. Alphabet spent years being cast as the company most exposed to the AI chatbot wave. This quarter, it looked more like the company riding it.
The numbers behind the quarter
Start with the acceleration, because that is the real headline inside the headline. Cloud revenue grew 63% in Q1 2026. One quarter later, the growth rate jumped to 82%.
Profitability followed. Google Cloud’s operating income more than tripled to $8.8 billion. Operating margins expanded to 35.6%.
Then there is the backlog. Alphabet reported $514 billion in contracted revenue not yet recognized. That backlog sits at more than 20 times Google Cloud’s quarterly revenue.
At the company level, Alphabet’s total revenue reached $119.8 billion, up 24% year over year. Cloud now accounts for roughly a fifth of that total.
Gemini goes mainstream
The Gemini app’s climb has been steep. It sat at around 750 million monthly active users in Q4 2025. Two quarters later, it reached 950 million.
Daily active users tripled year over year.
Developers are leaning in too. Google’s models are processing 22 billion API tokens per minute.
On the corporate side, nearly 90% of Fortune 100 companies are using Gemini Enterprise.
The price of the AI buildout
None of this comes cheap. Alphabet’s capital expenditures doubled year over year to $44.9 billion in Q2.
For context, that quarterly spending figure is larger than Google Cloud’s entire quarterly revenue.
CEO Sundar Pichai framed the spending as necessary to build out AI infrastructure and keep up with customer demand. He also said the company would forgo some short-term Cloud revenue to prioritize compute for its advanced models.
Background: the Search question
Alphabet, the parent of Google, Android and YouTube, has been working to pivot squarely toward AI. So far, Search has held up. Google Search revenue reached an all-time high last quarter, even as rival chatbots kept gaining attention.
What this means
For investors, the clearest signal is that Alphabet’s AI spending is showing up in revenue, not just in expenses. An 82% Cloud growth rate, a 35.6% margin and a $514 billion backlog give the company a concrete answer when asked what all that capex is buying.
Nearly 90% Fortune 100 adoption of Gemini Enterprise puts Alphabet in a strong position in the enterprise AI race. Combined with 950 million consumer users, Google has reach on both the business and consumer sides of AI.
Pichai’s comment about forgoing some short-term Cloud revenue is also worth watching. It signals capacity is tight.
Disclosure: This article was edited by Diego Almada Lopez. For more information on how we create and review content, see our Editorial Policy.