Alphabet’s cloud computing revenue surged to $24.8 billion in the second quarter of 2023, representing a year-over-year growth of 82%. The company’s backlog of contracted services now stands at $514 billion, with approximately half projected to be recognized over the next two years, translating to an average revenue of $128.5 billion annually from this backlog alone.
Despite a significant increase in capital expenditures—up 100% to nearly $45 billion—Alphabet has committed to investing $811 billion primarily in AI data centers over the next four and a half years. This investment strategy aims to scale up cloud revenue further, with expectations of near-term margin pressure due to reliance on third-party providers.
Alphabet is preparing for continued growth in its cloud division, with forecasts suggesting potential revenue of nearly $30 billion in the upcoming quarter if it maintains current growth rates. This positions the company as a key player in the competitive cloud services market, alongside Amazon and Microsoft.
5 Stocks Our Experts Predict Could Double In the Next Year
By submitting your email, you'll also get a free pivot & flow membership. A free daily market overview. You can unsubscribe at any time.
