Google's parent company, Alphabet Inc. has announced its fourth-quarter (Q4) earnings for 2024. The company reported a total revenue of $96.4 billion, marking a 12% increase from the same period in 2023. 

Google CEO, Sundar Pichai, attributed the company’s performance to its AI leadership and full-stack approach. “Our results show the power of our differentiated full-stack approach to AI innovation and the continued strength of our core businesses,” Pichai said.

Google Search and advertising growth slows 

Despite strong revenue growth, Alphabet’s advertising and search businesses saw slower year-over-year increases compared to Q4 2023. Google’s total advertising revenue including search, YouTube, and other ad platforms rose 10.6% to $72.46 billion, compared to 11% growth a year ago.

The platform's core search business generated $54 billion in revenue, up 12% from the previous year. This slightly exceeded analyst expectations of $53.3 billion but represented a minor slowdown compared to the 12.7% growth in Q4 2023.

YouTube ad revenue surpasses $10 billion

YouTube ad revenue saw a 14% year-over-year increase, reaching $10.47 billion for the first time in a single quarter. 

The platform outperformed Wall Street estimates of $10.23 billion, demonstrating strong advertiser demand. However, YouTube’s growth rate was slightly lower than the 15.5% growth recorded in Q4 2023.

Google Cloud revenue grows but misses estimates 

Google Cloud reported $12 billion in revenue, a 30% increase year over year. Google said this growth was driven by demand for Google Cloud Platform (GCP), AI infrastructure, and generative AI solutions. However, the division fell short of Wall Street’s $12.19 billion estimate.

Alphabet plans $75 Billion AI investment in 2025

Alphabet confirms its focus on artificial intelligence, with Pichai stating the company is making “dramatic progress” in AI development. The company confirmed plans to invest approximately $75 billion in capital expenditures in 2025 to expand its AI capabilities. Pichai has previously said its search engine will see “profound changes" this year and these changes will be driven by AI technologies.

As AI competition grows with Meta, OpenAI, Perplexity, and China’s DeepSeek, Google continues to position AI at the center of its growth strategy. The company has integrated AI Overviews into search results and expanded it to over 100 countries. 

Google also plans to bring the Gemini 2.0 AI model into AI Overviews later this year. Additionally, Google has been testing ads within AI Overviews, reporting monetization rates similar to traditional search ads.

“We’re rapidly shipping product improvements and seeing terrific momentum with consumer and developer usage,” Pichai said.

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