Google just had its first quarter of earnings shocks due to heavy AI spending

Google has reported its financial results for the second quarter of 2026 (PDF), and as usual, the search giant made an incredible amount of money. Google saw total revenue of $119.8 billion, exceeding analysts’ expectations by a healthy margin. Even so, the company’s stock took a hit. Along with all that investment, Google has announced another increase in its AI spending (or capex). The company is spending so much money on AI tools that it is breaking even for the first time.

Search was the largest part of Google’s revenue, accounting for $63.3 billion. Google Cloud pulled in $24.8 billion, a huge 23.8 percent increase from the first quarter. This shows that there is a huge demand for Google’s AI services. Google also earned $12.9 billion from its subscriptions, platforms, and tools, and $11.1 billion from YouTube ads. The company managed to stop the latter by 12 percent from the previous quarter when it made YouTube ads. longer.

A large portion of Google’s revenue comes from revenue. Excluding non-revenue items, Google’s operating income for Q2 2026 was approximately $39.1 billion. This is not the most the company has ever seen, but it is an increase of 40 percent from Q2 2025. The problem is that Google’s income has risen again – a lot.

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