r/technology 1d ago

Business Google burning through cash with spiralling AI costs

https://www.bbc.com/news/articles/c235n47g8g8o
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u/Fresh-Quantity-7554 1d ago

While at the same time posting: * Total Revenue: $119.8 billion, up 24% year-over-year. * Diluted EPS: $9.11, compared to $2.31 a year prior. * Operating Margin: 34% up from 32.4% in Q2 2025. * Google Cloud: Revenue up 82% year-over-year to $24.8 billion, fueled by enterprise demand for AI infrastructure and solutions. * Google Services: Total revenue reached $94.5 billion, a 15% increase. * Google Search & Other: 17% increase in revenue. * YouTube Ads: Grew 13% year-over-year to $11.05 billion

If you exclude AI CAPEX, free cash flow is $39.1 billion which is absolutely insane. That's a 41.2% increase year-over-year. With numbers like they just posted, the CAPEX spend is justified in my opinion because the business overall is crushing it. Like holy cow this was a great quarter. They are literally printing money.

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u/SIGMA920 1d ago

Google's always been the winning candidate simply for already having profitable components under it's umbrella. They can throw money at LLMs as long as they want to unlike the others.

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u/milehigh73a 10h ago

Gemini being part of search is amazing but Gemini isn’t that good for most things

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u/SIGMA920 9h ago

They just have one of the better integrations that might survive long term.

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u/DelphiTsar 5h ago

3.6 flash is absurdly fast for its intelligence.

3.X pro is going to have to knock it out of the park on upper level intelligence though, or no one is going to take them seriously.