What you need to know
- Google parent company Alphabet reported its Q2 2023 financial earnings on Tuesday.
- The company reported more than $74.6 billion in revenue, up 7% year-over-year.
- Alphabet highlights its increased investment in generative AI across its products, including Pixel devices.
Earnings season has returned, and Alphabet has released its Q2 2023 earning report for the period ending in June. During the quarter, Alphabet's revenue came in at $74.6 billion, with better-than-expected numbers across the board.
Search revenue rose to $42.6 billion, while YouTube ads and Google's Cloud division grew to $7.67 billion and $8.03 billion, respectively. The increase in ad revenue is particularly impressive, given the challenges Google has faced in ad spending.
"Our financial results reflect continued resilience in Search, with an acceleration of revenue growth in both Search and YouTube, as well as momentum in Cloud," says Ruth Porat, Alphabet's long-time CFO who will soon move into a new role as President and CIO.
Alphabet CEO Sundar Pichai adds in the financial release that increased product momentum has led to better-than-expected results for the quarter. "Our continued leadership in AI and our excellence in engineering and innovation are driving the next evolution of Search, and improving all our services."
Earlier this year, Google merged its two AI teams to create Google DeepMind as a way to accelerate its efforts in AI. We've already seen hints of new generative AI features coming to Google Assistant.
During the earnings call, Pichai highlighted the company's increased focus on generative AI, which is already integrated into many of its products, including Search and Workspace apps. The company has ramped up its rollout of AI services amid competition from companies like OpenAI with ChatGPT and Microsoft's Bing AI. Google's chatbot Bard recently rolled out across the EU while expanding its feature set and language availability.
Pichai also hints at generative AI features making their way to Android 14 and its recent Pixel phones, which have received a "great response" from consumers. Android 14 is expected to launch later this year, and some new features were shown off at Google I/O in May, including generative AI-based wallpapers.
"Android 14, our latest OS, will incorporate our advances in generative AI to personalize Android phones," Pichai stated during the call. "The Pixel and Android teams are working together to advance the latest devices." He highlights the new Pixel Fold as an example of how the hardware and software come together, which has been praised by Android Central's Nicholas Sutrich.
