wtf man gpt 5.6 is absolutely rl-fried when it comes to its websearch tool. in the process of searching for graph theory papers it decided to also sneak in Netflix, Steak n Shake, a trip to Universal Studios, and *five* fucking separate dictionary lookups of the word "they"
Google did not beat earnings expectations by 3x because AI suddenly made Search three times more profitable.
Roughly $6.26 of its reported $9.11 earnings per share came from gains on equity investments, including SpaceX.
Alphabet recorded a $98 billion increase in other income during the quarter. Most of the extraordinary $112 billion net profit was therefore an investment gain, much of it unrealized, rather than money generated by advertisements, subscriptions or cloud servers.
Remove the reported investment contribution and EPS falls to roughly $2.85. That is not directly comparable to every adjusted analyst estimate, but it puts the $9.11 headline in perspective.
The operating results were still impressive.
Revenue reached $119.8 billion, up 24%. Google Cloud grew 82% to $24.8 billion as demand for AI infrastructure accelerated. Search generated $63.3 billion, up nearly 17%, although it landed approximately in line with expectations.
Then there is the bill.
Alphabet spent almost $45 billion on capital expenditures during the quarter, roughly double last year, as it built data centers for AI. Free cash flow turned negative and the company conducted no share repurchases.
So this quarter contains two completely different Google stories.
The operating company produced strong growth while spending more heavily than ever.
Its investment portfolio briefly produced more profit than the operating company.
The $9.11 headline combines both and calls it earnings.
We're partnering with @huggingface to investigate an unprecedented security incident.
Cyber-capable OpenAI models compromised Hugging Face production during a benchmark evaluation.
Sharing preliminary findings to help defenders understand emerging risks:
https://t.co/CIor15y9xk
Say hello to Gemini 3.6 Flash, designed to be higher intelligence, more token efficient, and with a new lower price, based directly on developer feedback!
3.6 Flash continues our progress towards models that are deeply usable in real world scenarios!
The Trump administration is considering an executive order, and other means, to ban Chinese open-source models within in the United States. Kimi K3 has reignited this debate. Reporting this morning by Axios. Commerce is also considering adding Chinese AI labs to the Entity List.