Alphabet reported third-quarter revenue of $127.6 billion, up 25 percent year on year, with Google Cloud revenue of $30.7 billion, up 103 percent. Microsoft's Azure cloud business grew 48 percent in its fiscal first quarter ended September, and it lowered its full-year capital expenditure forecast to $170 billion from $175 billion. Alphabet posted negative free cash flow of $9.07 billion as spending rose, and its shares fell about 8 to 10 percent after the results, according to reports. Microsoft shares rose more than 3 percent in after-hours trading. The results came as investors weighed how much companies spend on AI against the income it generates.
Alphabet reported search and other revenue of about $63 billion for the quarter, up 12 percent but below analyst estimates for a second straight quarter. The company blames mainly currency effects and expects those to worsen in the fourth quarter. Free cash flow came in at negative $9 billion, three times the estimated deficit. Shares fell roughly 10 percent in after-hours trading following the announcement. Alphabet says it will keep investing in AI infrastructure and services, including its Gemini model.
SK hynix reported third-quarter operating profit of US$62.8bn, up 632% on the year, marking six straight quarters of record revenue and operating profit. Asian technology shares surged after the results, with investors citing renewed optimism about artificial intelligence demand. Separately, Anthropic reported first-half revenue growth of about 1,300% in its IPO filing, and Broadcom, Citi, Blackstone and Morgan Stanley announced a US$63bn financing structure for the company. Markets were also awaiting the Federal Reserve's policy decision.
Microsoft says Azure generated $33.2 billion in the July‑September quarter, a 48% increase from a year earlier and about $850 million above analysts’ expectations. The cloud service represented roughly 36% of Microsoft’s total quarterly revenue of $92.3 billion, keeping it ahead of Google Cloud, which reported $30.7 billion for the same period.