• by Laurie Sullivan , April 29, 2026

First-quarter calendar revenue reported by Alphabet and Microsoft demonstrates how strong ad and search services drive the companies' revenue-generating AI capabilities with increased efficiency and monetization across core digital platforms.

Alphabet reported $109.9 billion for the first quarter in 2026 on Wednesday -- up 22% year-over-year -- with growth primarily driven by cloud computing and AI investments. Analysts projected $107.2 billion.

“Our AI investments and full stack approach are lighting up every part of the business,” stated Alphabet CEO Sundar Pichai.

Google Cloud revenue rose 63% to $20 billion. The annual revenue for 2025 was $402.836 billion, up 15% compared with 2024. 

Advertising revenue came in at about $77.3 billion -- split between Google Search and YouTube -- with 200 million hours of content in the U.S. watched daily in the living room. Globally, that watch time is more than 1 billion hours.

Google Search revenue rose 19% to $60.4 billion for the quarter, with YouTube advertising revenue contributing $9.88 billion, largely driven by AI-driven efficiencies and a surge in high-intent search queries.

Google Search queries are at an all-time high, and people are asking more personal questions.

Google’s AI models as of early 2026 have been downloaded more than 500 million times.

During the earnings call, Pichai discussed the company's growth strategy, explaining a "full stack approach" that combines custom TPU hardware, optimizing Gemini models supported by a cloud infrastructure, as well as agentic models.

Microsoft also saw revenue growth from advertising, cloud services and AI. The company today reported $82.9 billion in revenue -- up 18% -- for the first calendar quarter in 2026.

Bing has gained more daily active users worldwide in the past five years than in the entire prior decade, signaling continued growth in search demand, according to Microsoft.

Search and news advertising revenue ex-TAC increased 12% and 9% in constant currency. 

As AI and LLMs shift consumer behavior, Bing usage spans traditional queries and more conversational Copilot-led experiences.

The engine combines reach with real-time intent signals across both traditional search and AI-driven experiences, giving advertisers more ways to reach consumers in active moments of decision.

Search and news advertising are part of Microsoft’s More Personal Computing segment, which reported a total revenue of $13.2 billion for the quarter, with a 1% decline year-over-year.

Although advertising grew, the success of the segment fell, with a 33% decline in Xbox hardware sales and a 2% dip in Windows OEM and devices. 

LinkedIn total revenue reached $4.71 billion, up 10%. This was driven by Marketing Solutions, its advertising business.