Alphabet Inc. (Class A) · Earnings release · 8-K Exhibit 99

EX-99.1 2 googexhibit991q32025.htm EX-99.1 Document Exhibit 99.1 Alphabet Announces Third Quarter 2025 Results MOUNTAIN VIEW, Calif. – October 29, 2025 – Alphabet Inc. (NASDAQ: GOOG, GOOGL) today announced financial results for the quarter ended September 30, 2025. • Consolidated Alphabet revenues in Q3 2025 increased 16%, or 15% in constant currency, year over year to $102.3 billion. Google Search & other, YouTube ads, Google subscriptions, platforms, and devices, and Google Cloud each delivered double-digit growth in Q3. • Google Services revenues increased 14% to $87.1 billion, reflecting robust performance across Google Search & other, Google subscriptions, platforms, and devices, and YouTube ads. • Google Cloud revenues increased 34% to $15.2 billion, led by growth in Google Cloud Platform (GCP) across core products, AI Infrastructure and Generative AI Solutions. • Total operating income increased 9% and operating margin was 30.5%.

Excluding the $3.5 billion charge related to the European Commission (EC) fine, T1operating income increased 22% and operating margin was 33.9%, benefitting from strong revenue growth and continued efficiencies in the expense base. • Other income reflected a net gain of $12.8 billion, primarily the result of net unrealized gains on our non-marketable equity securities. • Net income increased 33% and EPS increased 35% to $2.87. • T2With the growth across our business and demand from Cloud customers, G1we now expect 2025 capital expenditures to be in a range of $91 billion to $93 billion. "Alphabet had a terrific quarter, with double-digit growth across every major part of our business.

We delivered our first-ever $100 billion quarter," said Sundar Pichai, CEO of Alphabet and Google. "Our full stack approach to AI is delivering strong momentum and T3we're shipping at speed, including the global rollout of AI Overviews and AI Mode in Search in record time. In addition to topping leaderboards, T4our first party models, like Gemini, now process 7 billion tokens per minute, via direct API use by our customers. The Gemini App now has over 650 million monthly active users. We continue to drive strong growth in new businesses. T5Google Cloud accelerated, ending the quarter with $155 billion in backlog. And T6we have over 300 million paid subscriptions led by Google One and YouTube Premium."

"We are investing to meet customer demand and capitalize on the growing opportunities across the company." Q3 2025 Financial Highlights (unaudited) The following table summarizes our consolidated financial results for the quarters ended September 30, 2024 and 2025 (in millions, except for per share information and percentages). Quarter Ended September 30, 2024 2025 Revenues $ 88,268  $ 102,346  Change in revenues year over year 15  % 16  % Change in constant currency revenues year over year (1) 16  % 15  % Operating income $ 28,521  $ 31,228  Operating margin 32  % 31  % Other income (expense), net $ 3,185  $ 12,759  Net income $ 26,301  $ 34,979  Diluted EPS $ 2.12  $ 2.87  (1)     Non-GAAP measure.

See the section captioned "Reconciliation from GAAP Revenues to Non-GAAP Constant Currency Revenues and GAAP Percentage Change in Revenues to Non-GAAP Percentage Change in Constant Currency Revenues" for more details. Q3 2025 Supplemental Information (in millions, except for number of employees; unaudited) Revenues, Traffic Acquisition Costs (TAC), and Number of Employees Quarter Ended September 30, 2024 2025 Google Search & other $ 49,385  $ 56,567  YouTube ads 8,921  10,261  Google Network 7,548  7,354  Google advertising 65,854  74,182  Google subscriptions, platforms, and devices 10,656  12,870  Google Services total 76,510  87,052  Google Cloud 11,353  15,157  Other Bets 388  344  Hedging gains (losses) 17  (207) Total revenues $ 88,268  $ 102,346  Total TAC $ 13,719  $ 14,876  Number of employees 181,269 190,167 Segment Operating Results Quarter Ended September 30, 2024 2025 Operating income (loss): Google Services (1) $ 30,856  $ 33,527  Google Cloud 1,947  $ 3,594  Other Bets (1,116) $ (1,426) Alphabet-level activities (2) (3,166) $ (4,467) Total income from operations $ 28,521  $ 31,228  (1) Includes the EC fine of $3.5 billion for the three months ended September 30, 2025. (2) In addition to the costs included in Alphabet-level activities, hedging gains (losses) related to revenue were $17 million and $(207) million for the three months ended September 30, 2024 and 2025, respectively.

Alphabet-level activities include charges related to employee severance and office space charges. Additional Information Relating to the Quarter Ended September 30, 2025 (unaudited) EC Fine T7On September 5, 2025, the EC announced its decision that Google had infringed European competition laws. The EC decision imposed a $3.5 billion fine which we accrued in general and administrative expenses in our Google Services segment for the three months ended September 30, 2025. U.S. Tax Law T8Changes to U.S. tax law enacted on July 4, 2025, allow, among other things, for immediate expensing of domestic research and experimentation costs and accelerated depreciation on eligible capital expenditures, the effects of which are included in operating cash flows for the three months ended September 30, 2025.

Dividend Program Alphabet's Board of Directors declared a quarterly cash dividend of $0.21 payable on December 15, 2025 to stockholders of record for each of the Company's Class A, Class B, and Class C shares as of December 8, 2025. 2 Webcast and Conference Call Information A live audio webcast of our third quarter 2025 earnings release call will be available on YouTube at https://www.youtube.com/watch?v=hA1OEi6TRYU. The call begins today at 2:30 PM (PT) / 5:30 PM (ET). This press release, including the reconciliations of certain non-GAAP measures to their nearest comparable GAAP measures, is also available at http://abc.xyz/investor. We also provide announcements regarding our financial performance, including SEC filings, investor events, press and earnings releases, and blogs, on our investor relations website (http://abc.xyz/investor).

We also share Google news and product updates on Google's Keyword blog at https://www.blog.google/ and News From Google page on X at x.com/NewsFromGoogle, and our executive officers may also use certain social media channels, such as X and LinkedIn, to communicate information about earnings results and company updates, which may be of interest or material to our investors. Forward-Looki ng Statements This press release may contain forward-looking statements that involve risks and uncertainties. Actual results may differ materially from the results predicted, and reported results should not be considered as an indication of future performance. The potential risks and uncertainties that could cause actual results to differ from the results predicted include, among others, those risks and uncertainties included under the captions "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the year ended December 31, 2024 and our most recent Quarterly Report on Form 10-Q for the quarter ended June 30, 2025 , which are on file with the SEC and are available on our investor relations website at http://abc.xyz/investor and on the SEC website at www.sec.gov.

Additional information will also be set forth in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2025, and may be set forth in other reports and filings we make with the SEC. All information provided in this release and in the attachments is as of October 29, 2025 . Undue reliance should not be placed on the forward-looking statements in this press release, which are based on information available to us on the date hereof. We undertake no duty to update this information unless required by law. About Non-GAAP Financial Measures To supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, we use the following non-GAAP financial measures: operating income, excluding the EC fine; operating margin, excluding the EC fine; free cash flow; constant currency revenues; and percentage change in constant currency revenues.

The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. We use these non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. We believe that these non-GAAP financial measures provide meaningful supplemental information regarding our performance and liquidity by excluding certain items that may not be indicative of our recurring core business operating results, such as our revenues excluding the effect of foreign exchange rate movements and hedging activities, which are recognized at the consolidated level. We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, and analyzing future periods.

These non-GAAP financial measures also facilitate management's internal comparisons to our historical performance and liquidity as well as comparisons to our competitors' operating results. We believe these non-GAAP financial measures are useful to investors both because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making and (2) they are used by our institutional investors and the analyst community to help them analyze the health of our business. There are a number of limitations related to the use of non-GAAP financial measures. We compensate for these limitations by providing specific information regarding the GAAP amounts excluded from these non-GAAP financial measures and evaluating these non-GAAP financial measures together with their relevant financial measures in accordance with GAAP.

For more information on these non-GAAP financial measures, please see the sections captioned "Reconciliation of GAAP Operating Income and Operating Margin to Non-GAAP Operating Income and Operating Margin, Excluding the EC Fine", "Reconciliation from GAAP Net Cash Provided by Operating Activities to Non-GAAP Free Cash Flow", and "Reconciliation from GAAP Revenues to Non-GAAP Constant Currency Revenues and GAAP Percentage Change in Revenues to Non-GAAP Percentage Change in Constant Currency Revenues" included at the end of this release. Contact Investor relations Media investor-relations@abc.xyz press@abc.xyz 3 Alphabet Inc. CONSOLIDATED BALANCE SHEETS (In millions, except par value per share amounts) As of December 31, 2024 As of September 30, 2025 (unaudited) Assets Current assets: Cash and cash equivalents $ 23,466  $ 23,090  Marketable securities 72,191  75,406  Total cash, cash equivalents, and marketable securities 95,657  98,496  Accounts receivable, net 52,340  57,148  Other current assets 15,714  18,303  Total current assets 163,711  173,947  Non-marketable securities 37,982  63,800  Deferred income taxes 17,180  10,331  Property and equipment, net 171,036  223,787  Operating lease assets 13,588  14,524  Goodwill 31,885  33,269  Other non-current assets 14,874  16,811  Total assets $ 450,256  $ 536,469  Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 7,987  $ 10,546  Accrued compensation and benefits 15,069  13,944  Accrued expenses and other current liabilities 51,228  59,437  Accrued revenue share 9,802  10,081  Deferred revenue 5,036  5,542  Total current liabilities 89,122  99,550  Long-term debt 10,883  21,607  Income taxes payable, non-current 8,782  10,072  Operating lease liabilities 11,691  12,106  Other long-term liabilities 4,694  6,267  Total liabilities 125,172  149,602  Commitments and contingencies Stockholders' equity: Preferred stock, $0.001 par value per share, 100 shares authorized; no shares issued and outstanding 0  0  Class A, Class B, and Class C stock and additional paid-in capital, $0.001 par value per share: 300,000 shares authorized (Class A 180,000, Class B 60,000, Class C 60,000); 12,211 (Class A 5,835, Class B 861, Class C 5,515) and 12,077 (Class A 5,818, Class B 842, Class C 5,417) shares issued and outstanding 84,800  91,695  Accumulated other comprehensive income (loss) (4,800) (2,054) Retained earnings 245,084  297,226  Total stockholders' equity 325,084  386,867  Total liabilities and stockholders' equity $ 450,256  $ 536,469  4 Alphabet Inc.

CONSOLIDATED STATEMENTS OF INCOME (In millions, except per share amounts, unaudited) Quarter Ended September 30, Year To Date September 30, 2024 2025 2024 2025 Revenues $ 88,268  $ 102,346  $ 253,549  $ 289,007  Costs and expenses: Cost of revenues 36,474  41,369  105,693  116,768  Research and development 12,447  15,151  36,210  42,515  Sales and marketing 7,227  7,205  20,445  20,478  General and administrative 3,599  7,393  9,783  16,141  Total costs and expenses 59,747  71,118  172,131  195,902  Income from operations 28,521  31,228  81,418  93,105  Other income (expense), net 3,185  12,759  6,154  26,604  Income before income taxes 31,706  43,987  87,572  119,709  Provision for income taxes 5,405  9,008  13,990  21,994  Net income $ 26,301  $ 34,979  $ 73,582  $ 97,715  Basic net income per share $ 2.14  $ 2.89  $ 5.96  $ 8.06  Diluted net income per share $ 2.12  $ 2.87  $ 5.90  $ 7.99  Number of shares used in basic earnings per share calculation 12,290  12,086  12,349  12,130  Number of shares used in diluted earnings per share calculation 12,419  12,203  12,480  12,230  5 Alphabet Inc.

CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions, unaudited) Quarter Ended September 30, Year To Date September 30, 2024 2025 2024 2025 Operating activities Net income $ 26,301  $ 34,979  $ 73,582  $ 97,715  Adjustments: Depreciation of property and equipment 3,985  5,611  11,106  15,096  Stock-based compensation expense 5,846  6,368  16,975  17,882  Deferred income taxes (1,071) 8,726  (3,809) 7,130  Loss (gain) on debt and equity securities, net (1,981) (10,855) (2,738) (22,266) Other 1,407  (198) 2,592  843  Changes in assets and liabilities, net of effects of acquisitions: Accounts receivable, net (1,431) (2,381) (1,321) (3,582) Income taxes, net (1,908) (858) (2,797) (3,292) Other assets (802) (1,293) (2,334) (4,060) Accounts payable 521  (444) (42) (771) Accrued expenses and other liabilities (1,190) 7,759  (6,366) 6,199  Accrued revenue share 381  319  478  100  Deferred revenue 640  681  860  1,317  Net cash provided by operating activities 30,698  48,414  86,186  112,311  Investing activities Purchases of property and equipment (13,061) (23,953) (38,259) (63,596) Purchases of marketable securities (22,023) (20,964) (65,034) (60,834) Maturities and sales of marketable securities 23,202  20,371  81,779  61,301  Purchases of non-marketable securities (1,035) (1,000) (3,234) (3,312) Maturities and sales of non-marketable securities 127  323  732  1,196  Acquisitions, net of cash acquired, and purchases of intangible assets (2,753) (1,072) (2,840) (1,425) Other investing activities (2,468) (1,482) (2,500) (1,845) Net cash used in investing activities (18,011) (27,777) (29,356) (68,515) Financing activities Net payments related to stock-based award activities (3,003) (3,270) (9,141) (9,001) Repurchases of stock (15,291) (11,504) (46,671) (40,210) Dividend payments (2,455) (2,537) (4,921) (7,513) Proceeds from issuance of debt, net of costs 3,819  6,624  8,694  38,002  Repayments of debt (3,449) (7,696) (8,951) (26,094) Proceeds from sale of interest in consolidated entities, net 285  0  293  400  Net cash used in financing activities (20,094) (18,383) (60,697) (44,416) Effect of exchange rate changes on cash and cash equivalents 141  (200) (222) 244  Net increase (decrease) in cash and cash equivalents (7,266) 2,054  (4,089) (376) Cash and cash equivalents at beginning of period 27,225  21,036  24,048  23,466  Cash and cash equivalents at end of period $ 19,959  $ 23,090  $ 19,959  $ 23,090  6 Segment Results The following table presents our segment revenues and operating income (loss) (in millions; unaudited): Quarter Ended September 30, 2024 2025 Revenues: Google Services $ 76,510  $ 87,052  Google Cloud 11,353  15,157  Other Bets 388  344  Hedging gains (losses) 17  (207) Total revenues $ 88,268  $ 102,346  Operating income (loss): Google Services $ 30,856  $ 33,527  Google Cloud 1,947  3,594  Other Bets (1,116) (1,426) Alphabet-level activities (3,166) (4,467) Total income from operations $ 28,521  $ 31,228  We report our segment results as Google Services, Google Cloud, and Other Bets: • Google Services includes products and services such as ads, Android, Chrome, devices, Google Maps, Google Play, Search, and YouTube.

Google Services generates revenues primarily from advertising; fees received for consumer subscription-based products such as YouTube TV, YouTube Music and Premium, and NFL Sunday Ticket, as well as Google One; the sale of apps and in-app purchases; and devices. • Google Cloud includes infrastructure and platform services, applications, and other services for enterprise customers. Google Cloud generates revenues primarily from consumption-based fees and subscriptions received for Google Cloud Platform services, Google Workspace communication and collaboration tools, and other enterprise services. • Other Bets is a combination of multiple operating segments that are not individually material. Revenues from Other Bets are generated primarily from the sale of autonomous transportation services, healthcare-related services, and internet services.

Certain costs are not allocated to our segments because they represent Alphabet-level activities. These costs primarily include certain AI-focused shared R&D activities, including development costs of our general AI models; corporate initiatives such as our philanthropic activities; corporate shared costs such as certain finance, human resource, and legal costs, including certain fines and settlements. Charges associated with employee severance and office space reductions are also not allocated to our segments. Additionally, hedging gains (losses) related to revenue are not allocated to our segments. 7 Other Income (Expense), Net The following table presents our other income (expense), net (in millions; unaudited): Quarter Ended September 30, 2024 2025 Interest income $ 1,243  $ 1,076  Interest expense (54) (143) Foreign currency exchange gain (loss), net 23  (143) Gain (loss) on debt securities, net 160  122  Gain (loss) on equity securities, net (1) 1,821  10,734  Performance fees 29  (174) Income (loss) and impairment from equity method investments, net (107) (30) Other 70  1,317  Other income (expense), net $ 3,185  $ 12,759  (1) Includes all gains and losses, unrealized and realized, on equity securities.

For Q3 2025, the net effect of the gain on equity securities of $10.7 billion and the performance fees related to certain investments of $174 million increased the provision for income tax, net income, and diluted net income per share by $2.2 billion, $8.3 billion, and $0.68, respectively. Fluctuations in the value of our investments may be affected by market dynamics and other factors and could significantly contribute to the volatility of OI&E in future periods. Reconciliation of GAAP Operating Income and Operating Margin to Non-GAAP Operating Income and Operating Margin, Excluding the EC Fine (in millions, except percentages; unaudited) : We provide the following non-GAAP measures because they provide useful information to management and investors about the effect of the EC fine on operating income and operating margin in the third quarter of 2025 for comparability to operating income and operating margin in the third quarter of 2024. • Non-GAAP operating income, excluding the EC fine • Non-GAAP operating margin, excluding the EC fine These non-GAAP measures exclude the effect of the EC fine recorded during the third quarter of 2025.

We calculate the percentage change by comparing operating income, excluding the EC fine recorded in the third quarter of 2025 to the prior year comparable quarter. Quarter Ended September 30, 2024 2025 % Change Revenues $ 88,268  $ 102,346  16  % Operating income (GAAP) $ 28,521  $ 31,228  9  %     add: EC fine 0  3,457  Operating income, excluding the EC fine (Non-GAAP) $ 28,521  $ 34,685  22  % Operating margin (GAAP) 32.3  % 30.5  % Operating margin, excluding the EC fine (Non-GAAP) 32.3  % 33.9  % Non-GAAP operating income, excluding the EC fine: We define Non-GAAP operating income, excluding the EC fine as operating income excluding the EC fine.

Non-GAAP operating margin, excluding the EC fine: We define Non-GAAP operating margin, excluding the EC fine as Non-GAAP operating income, excluding the EC fine divided by revenues. 8 Reconciliation from GAAP Net Cash Provided by Operating Activities to Non-GAAP Free Cash Flow (in millions; unaudited) : We provide non-GAAP free cash flow for the current quarter and trailing twelve months ("TTM") because it is a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business that can be used for strategic opportunities, including investing in our business and acquisitions, and to strengthen our balance sheet. Quarter Ended TTM Q4 2024 Q1 2025 Q2 2025 Q3 2025 Q3 2025 Net cash provided by operating activities $ 39,113  $ 36,150  $ 27,747  $ 48,414  $ 151,424  Less: purchases of property and equipment (14,276) (17,197) (22,446) (23,953) (77,872) Free cash flow $ 24,837  $ 18,953  $ 5,301  $ 24,461  $ 73,552  Free cash flow: We define free cash flow as net cash provided by operating activities less capital expenditures.

TTM free cash flow: We define trailing twelve months free cash flow as net cash provided by operating activities less capital expenditures for the most recent twelve consecutive months. 9 Reconciliation from GAAP Revenues to Non-GAAP Constant Currency Revenues and GAAP Percentage Change in Revenues to Non-GAAP Percentage Change in Constant Currency Revenues (in millions, except percentages; unaudited) : We provide non-GAAP constant currency revenues ("constant currency revenues") and non-GAAP percentage change in constant currency revenues ("percentage change in constant currency revenues"), because they facilitate the comparison of current results to historic performance by excluding the effect of foreign exchange rate movements ("FX Effect") as well as hedging activities, which are recognized at the consolidated level, as they are not indicative of our core operating results.

Non-GAAP constant currency revenues is defined as revenues excluding the effect of foreign exchange rate movements and hedging activities and is calculated by translating current period revenues using prior period exchange rates and excluding any hedging effect recognized in the current period. We calculate the percentage change in constant currency revenues by comparing constant currency revenues to the prior year comparable period revenues, excluding any hedging effect recognized in the prior period. Revenues by Geography Comparison from the Quarter Ended September 30, 2024 to the Quarter Ended September 30, 2025 Quarter Ended September 30, 2025 % Change from Prior Period Quarter Ended September 30, Less FX Effect Constant Currency Revenues As Reported Less Hedging Effect Less FX Effect Constant Currency Revenues 2024 2025 United States $ 43,139  $ 48,758  $ 0  $ 48,758  13  % 0  % 13  % EMEA 25,472  29,911  1,261  28,650  17  % 5  % 12  % APAC 14,547  17,819  128  17,691  22  % 0  % 22  % Other Americas 5,093  6,065  (50) 6,115  19  % (1) % 20  % Revenues, excluding hedging effect 88,251  102,553  1,339  101,214  16  % 1  % 15  % Hedging gains (losses) 17  (207) Total revenues (1) $ 88,268  $ 102,346  $ 101,214  16  % 0  % 1  % 15  % (1) Total constant currency revenues of $101.2 billion for the quarter ended September 30, 2025 increased $13.0 billion compared to $88.3 billion in revenues, excluding hedging eff ect, for the quarter ended September 30, 2024.

Comparison from the Quarter Ended June 30, 2025 to the Quarter Ended September 30, 2025 Quarter Ended September 30, 2025 % Change from Prior Period Quarter Ended Less FX Effect Constant Currency Revenues As Reported Less Hedging Effect Less FX Effect Constant Currency Revenues June 30, 2025 September 30, 2025 United States $ 46,063  $ 48,758  $ 0  $ 48,758  6  % 0  % 6  % EMEA 28,262  29,911  753  29,158  6  % 3  % 3  % APAC 16,480  17,819  75  17,744  8  % 0  % 8  % Other Americas 5,735  6,065  90  5,975  6  % 2  % 4  % Revenues, excluding hedging effect 96,540  102,553  918  101,635  6  % 1  % 5  % Hedging gains (losses) (112) (207) Total revenues (1) $ 96,428  $ 102,346  $ 101,635  6  % 0  % 1  % 5  % (1) Total constant currency revenues of $101.6 billion for the quarter ended September 30, 2025 increased $5.1 billion compared to $96.5 billion in revenues, excluding hedging effect, for the quarter e nded June 30, 2025. 10 Total Revenues — Prior Year Comparative Periods Comparison from the Quarter Ended September 30, 2023 to the Quarter Ended September 30, 2024 Quarter Ended September 30, 2024 Quarter Ended September 30, % Change from Prior Period   Less FX Effect Constant Currency Revenues As Reported Less Hedging Effect Less FX Effect Constant Currency Revenues 2023 2024 Revenues excluding hedging effect $ 76,694  $ 88,251  $ (1,017) $ 89,268  15  % (1) % 16  % Hedging gains (losses) $ (1) $ 17  Total revenues $ 76,693  $ 88,268  $ 89,268  15  % 0  % (1) % 16  % 11