Odaily Planet Daily reports that Alphabet says demand for its cloud services is growing rapidly, as evidenced by the increase in its "backlog" (unfulfilled cloud service contracts). However, more than one-third of this quarterly growth comes from a joint venture in which the company holds an equity stake.
This disclosure was included in a quarterly filing submitted on Thursday. The filing outlines AI-related risks facing Alphabet, extending beyond what the company discussed during its earnings call the previous day. In addition to the over $1 trillion in procurement commitments, future lease payments, and other obligations disclosed by the CFO on the investor call, the document lists approximately $98.5 billion in contingent commitments—obligations the company may be required to fulfill under certain conditions. This amount represents an increase of about $23 billion from the prior quarter. These commitments include guarantees for data center lease payments, support for partners’ purchases of power equipment, and potential repurchases of AI chip systems from customers under specific circumstances. (Bloomberg)
According to MSX.COM, Alphabet (GOOG.O) opened down 13% in U.S. trading today, with a market cap loss of nearly $490 billion; the decline has since narrowed to 11.56%.
Previously, Alphabet released its third-quarter financial results, reporting revenue of $127.58 billion, a 25% year-over-year increase, but below the market expectation of $127.91 billion; adjusted earnings per share came in at $2.67, below the expected $2.97. Google Cloud revenue surged 103% year-over-year to $30.71 billion, but its core advertising business underperformed expectations, and free cash flow recorded a net outflow of $9.07 billion.