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Alphabet Inc. GOOGL

Communication Services  —  Internet Content & Information
343.92 1.56 0.46% as of 25 Sep
Market cap
$4.17T
P/E
17.1×
S&P 500 Member Dividend Champion (3y) Cash Flow Champion (3y) Revenue Champion (10y)
Indexes indicate stock being part of an index,
Growth Flags show if company had growth for consecutive years
Overview Business Profile Financial Analysis Income Statement Balance Sheet Cash Flow Metrics & Ratios 10-Q 10-K

Alphabet Inc. (GOOGL) Financial Analysis

Updated · Covers results through Q2 FY2026 · How this is made

Snapshot

Alphabet generated revenue of $402.8 billion in FY2025, operating income of $129.0 billion in FY2025 and net income of $132.2 billion in FY2025. Revenue growth was 15.1% in FY2025 against FY2024, while diluted EPS growth was 34.5% in FY2025 against FY2024.

In Q2 FY2026, revenue was $119.8 billion, gross profit was $73.9 billion, operating income was $40.8 billion and net income was $112.2 billion. Diluted EPS was $9.11 in Q2 FY2026, while free cash flow was −$5.9 billion in Q2 FY2026. Revenue over the TTM to Q2 FY2026 was $445.9 billion, and net income over the TTM to Q2 FY2026 was $244.2 billion.

Growth

Revenue was $402.8 billion in FY2025, compared with $350.0 billion in FY2024, and revenue growth was 15.1% in FY2025 against FY2024. Revenue compound annual growth was 12.5% in FY2022–FY2025 and 17.2% in FY2020–FY2025. Diluted EPS was $10.81 in FY2025, compared with $8.04 in FY2024, with growth of 34.5% in FY2025 against FY2024.

  • Diluted EPS compound annual growth was 33.3% in FY2022–FY2025 and 29.8% in FY2020–FY2025.
  • Free cash flow was $73.3 billion in FY2025, with growth of 0.69% in FY2025 against FY2024; its compound annual growth was 6.88% in FY2022–FY2025 and 11.3% in FY2020–FY2025.
  • Revenue was $119.8 billion in Q2 FY2026, up 24.2% in Q2 FY2026 against Q2 FY2025, while diluted EPS was $9.11 in Q2 FY2026, up 294.4% in Q2 FY2026 against Q2 FY2025.

Profitability

Gross margin was 59.7% in FY2025, an increase of 1.5 percentage points in FY2024–FY2025 and 6.1 percentage points in FY2020–FY2025. Operating margin was 32.0% in FY2025, down −0.1 percentage points in FY2024–FY2025 but up 9.4 percentage points in FY2020–FY2025. Pre-tax margin was 39.4% in FY2025, up 5.2 percentage points in FY2024–FY2025 and 13.1 percentage points in FY2020–FY2025.

Net margin was 32.8% in FY2025, up 4.2 percentage points in FY2024–FY2025 and 10.7 percentage points in FY2020–FY2025. Return on equity was 35.7% in FY2025, return on assets was 25.3% in FY2025 and return on invested capital was 24.1% in FY2025. Industry-median comparisons are not reported.

Balance sheet

Cash and short-term investments were $126.8 billion in FY2025, compared with total debt of $46.5 billion in FY2025. Net debt was −$80.3 billion in FY2025, indicating that cash and short-term investments exceeded total debt in FY2025. Shareholders’ equity was $415.3 billion in FY2025, and working capital was $103.3 billion in FY2025.

In Q2 FY2026, net debt was −$144.3 billion, the current ratio was 2.7× and debt to equity was 0.2×. Net debt was −$49.3 billion in Q1 FY2026, so the negative net-debt balance was larger in Q2 FY2026 than in Q1 FY2026. The available figures do not report cash, total debt, equity or working capital for Q2 FY2026.

Cash flow & capital return

Operating cash flow was $164.7 billion in FY2025, up 31.5% in FY2025 against FY2024. Capital expenditure was $91.4 billion in FY2025, compared with $52.5 billion in FY2024. Free cash flow was $73.3 billion in FY2025, up 0.69% in FY2025 against FY2024, and represented 55.4% of net income in FY2025.

  • Dividends paid were $10.0 billion in FY2025, and net share repurchases were $45.7 billion in FY2025.
  • Capital returned to shareholders was $55.8 billion in FY2025.
  • Weighted average shares were 12.1 billion shares in FY2025, and the share count changed by −11.0% in FY2020–FY2025.
  • Operating cash flow was $185.7 billion over the TTM to Q2 FY2026, while free cash flow was $53.3 billion over the TTM to Q2 FY2026.

Valuation

Market capitalisation was $4.16 trillion as of September 24, 2026. P/E was 17.0× as of September 24, 2026, below the five-year median of 23.6× as of September 24, 2026, over the five fiscal years to FY2025 and the ten-year median of 26.2× as of September 24, 2026, over the ten fiscal years to FY2025. P/S was 9.3× as of September 24, 2026, above the five-year median of 6.7× as of September 24, 2026, over the five fiscal years to FY2025 and the ten-year median of 6.3× as of September 24, 2026, over the ten fiscal years to FY2025.

  • P/B was 6.7× as of September 24, 2026, below its five-year median and above its ten-year median.
  • EV/Sales was 9.0× as of September 24, 2026, above both historical medians, while EV/Cash flow was 75.4× as of September 24, 2026, above both historical medians.
  • Industry-median valuation comparisons are not reported.

What changed since last quarter

Revenue was $119.8 billion in Q2 FY2026, compared with $109.9 billion in Q1 FY2026, a change of 9.01% in Q2 FY2026 against Q1 FY2026. Diluted EPS was $9.11 in Q2 FY2026, compared with $5.11 in Q1 FY2026, a change of 78.3% in Q2 FY2026 against Q1 FY2026. Gross margin was 61.6% in Q2 FY2026, down −0.8 percentage points in Q2 FY2026 against Q1 FY2026, and operating margin was 34.0% in Q2 FY2026, down −2.1 percentage points in Q2 FY2026 against Q1 FY2026.

Against Q2 FY2025, revenue changed 24.2% in Q2 FY2026 against Q2 FY2025 and diluted EPS changed 294.4% in Q2 FY2026 against Q2 FY2025. Free cash flow was −$5.9 billion in Q2 FY2026, with a change of −210.5% in Q2 FY2026 against Q2 FY2025. No management explanation for these changes is reported.

Open questions

  • What caused net income and diluted EPS to change more than revenue in the latest quarter?
  • What drove the negative free cash flow reported in the latest quarter?
  • What accounts for the change in net debt between the two most recent quarters?
  • Which operating factors contributed to the latest-quarter margin movements?

This page is for information only. It is not investment advice, a recommendation or an offer to buy or sell any security. Figures may contain errors; verify against the company's filings.