Mountain View, California – Alphabet, the parent company of Google, set the stage for a strong start to Big Tech earnings season by surpassing analysts’ expectations in its fiscal third quarter report. The tech giant reported earnings per share of $2.12 on revenue of $88.27 billion, marking a 37% increase in profit and a 15% increase in sales compared to the same period last year.

Analysts had anticipated earnings per share of $1.83 on revenue of $86.44 billion, according to data compiled by Bloomberg. Alphabet’s stock rose 4% in after-hours trading following the earnings release. Advertising revenue also exceeded expectations, reaching $65.85 billion, up from $59.65 billion in the year-ago period.

Google CEO Sundar Pichai highlighted the company’s cloud business growth during an earnings call, emphasizing the success of their AI portfolio in attracting new customers and securing larger deals. Cloud revenue for the quarter stood at $11.4 billion, a 35% increase from the same period last year, outperforming projections.

With competitors like Microsoft and Amazon also expanding their cloud businesses and investing in AI infrastructure, Google faces increasing competition in the tech landscape. Reports suggest that Meta, formerly known as Facebook, is developing its own search engine to support its AI chatbot, posing a potential challenge to Google’s dominance in the field.

The evolution of answer engines and AI-powered technologies presents a key question for Google as it navigates the shifting technological landscape. As the first of the Big Tech companies to report earnings this week, Alphabet’s performance sets the tone for upcoming reports from Meta, Microsoft, Amazon, and Apple, each facing unique challenges and opportunities in the market.

As investors closely monitor AI investments and business success, the divergent paths taken by these tech giants reflect evolving strategies and priorities in an ever-changing industry landscape. The upcoming quarterly reports will provide further insight into the performance and future outlook of these major players in the tech sector.