Alphabet Beats Q2 on Cloud Surge While Meta Misses as Costs Soar

Earnings Impact 4
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Summary · why it matters

Alphabet beat second-quarter expectations with revenue rising 24.23% to $119.8 billion, driven by Google Cloud's 82% surge to $24.77 billion, while Meta Platforms missed earnings per share by 14.42% as total costs jumped 55%. Alphabet's operating margin expanded to 34%, and nearly 90% of the Fortune 100 now use Gemini Enterprise. Meta's EPS came in at $6.18 versus the $7.2173 expected, weighed down by $2.40 billion in legal charges and $1.18 billion in severance, causing its operating margin to collapse from 43% to 31%. Both companies saw free cash flow crater amid heavy AI capital expenditure, with Alphabet swinging to negative $5.86 billion and Meta's falling 91.31% to $784 million. Meta guided full-year capex to a range of $130 billion to $145 billion and raised its expense outlook to $165 billion to $169 billion, while Alphabet suspended its buyback after raising roughly $70 billion in combined equity and debt.

Impact on stocks 2

Artificial Intelligence± Mixed · 2 stocks
Alphabet Inc Class C
GOOG
▲ PositiveCapitalrelevance

Alphabet beat Q2 expectations with strong revenue growth and margin expansion, though free cash flow turned negative due to heavy AI capex.

Meta Platforms Inc.
META
▼ NegativeCapitalrelevance

Meta missed EPS estimates as costs surged, with legal charges and severance weighing on margins, and guided higher capex and expenses.

Theme Impact 2

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