Alphabet (NASDAQ:GOOG) posted strong Q1 FY2025 results, beating both revenue and EPS expectations. The quarter was driven by broad-based strength across the business, particularly in Google Services, where Search and YouTube Ads each grew 10% year-over-year. Subscriptions revenue—driven by YouTube Premium, YouTube TV, and Google One—jumped 19%. Google Cloud contributed $12.3 billion in revenue and reached an operating margin of 17.8%, continuing its margin improvement trajectory, though it still trails behind key peers like Microsoft Azure and AWS.
Waymo is gaining traction, with the company now delivering approximately 250,000 paid rides per week across its existing service areas—San Francisco, Phoenix, Los Angeles, and Austin. Expansion into Atlanta is confirmed, with Washington D.C. and Miami on the near-term roadmap. The Uber partnership has further accelerated rider demand, but Alphabet has yet to disclose the financial contribution from Waymo, leaving the unit’s economics opaque.
One noteworthy item was the sharp increase in “Other Income,” primarily driven by an unrealized gain of roughly $9 billion from a private investment. While this provided a material lift to reported EPS, it is non-recurring and non-operational in nature. Alphabet, under Sundar Pichai, has a reputation for strategic and sophisticated financial reporting, and this instance serves as a reminder that headline numbers may not always reflect underlying performance.
For more details, key highlights, and commentary, check out the high-level earnings summary.
