What you need to know
- Alphabet, Google's parent company, announced its Q3 2024 financial earnings.
- Google Cloud revenues saw strong growth as the company shifts its focus to AI.
- Google's subscriptions, platforms, and devices segment also saw a notable increase, likely driven by increased Pixel sales and AI subscriptions.
- CEO Sundar Pichai teased experiences like Project Astra shipping in 2025.
Google's parent company Alphabet reported its Q3 earnings on Tuesday, announcing a 15% increase in revenue to $88.2 billion compared to the same period last year.
Search unsurprisingly accounted for the largest portion of Google's revenue at just under $50 billion. However, Google Cloud managed a sizeable 35% revenue gain, increasing to $11.4 billion during the quarter despite heavier losses in the segment.
"The momentum across the company is extraordinary. Our commitment to innovation, as well as our long-term focus and investment in AI, are paying off with consumers and partners benefiting from our AI tools," remarked Alphabet CEO Sundar Pichai in a prepared statement.
"In Search, our new AI features are expanding what people can search for and how they search for it. In Cloud, our AI solutions are helping drive deeper product adoption with existing customers, attract new customers and win larger deals.
And YouTube's total ads and subscription revenues surpassed $50 billion over the past four quarters for the first time. We generated strong revenue growth in the quarter, and our ongoing efforts to improve efficiency helped deliver improved margins. I’m looking forward to driving more advances for consumers, customers and creators globally."
Google has made significant internal restructuring efforts as the company has shifted its focus on AI. This month, the company announced that the Gemini app team will move under the Google DeepMind team, while the Google Assistant team will join the new Platform & Devices team. P&D was established earlier this year during the first 2024 restructuring, bringing Google's Android and hardware teams under one roof to help accelerate.
Pichai also took a moment to highlight its hardware and platforms during the earnings call, including its latest Pixel 9 series phones. He noted how Google is seeing "strong demand" for these devices, and how they're driving adoption of its Gemini AI models and features. Circle to Search, for example, is now on 150 million Android devices, with the Motorola Razr and OnePlus phones among the latest to receive the feature.
"[Gemini is] available on Android, including Samsung Galaxy devices. We continue to work closely with them to deliver innovations across their newest devices, with much more to come."
Google also teased updates on Project Astra, a real-time multimodal AI experience the company revealed at Google I/O 2024. It looks at your surroundings through a camera and answers your questions based on that visual context, an experience that seems fit for AR glasses. While Pichai did not say that Google is launching AR glasses, he did say that it is "building out experiences where AI can see and reason about the world around you."
And regarding Astra, he notes that Google is "working to ship experiences like this as early as 2025; we then work to bring those advances to consumers and businesses."
