Google Cloud revenue soars 103%, outpacing Azure and AWS as AI demand fuels growth
Alphabet's cloud business has more than doubled its revenue in a year, making it the fastest-growing among the three major cloud providers. However, Amazon Web Services remains the industry leader by revenue. Google is rapidly closing the gap with its biggest cloud computing rivals after reporting a staggering 103% increase in Google Cloud revenue for the third quarter of 2026.
The business generated $30.7 billion in revenue for the three months ended September 30, compared with $15.2 billion during the same period last year. The results comfortably exceeded analysts' expectations of approximately $29.6 billion.
The growth was driven primarily by increasing demand for artificial intelligence infrastructure, enterprise AI solutions and Google's cloud computing services. Sales of Google's custom Tensor Processing Units (TPUs), specialised chips designed to accelerate AI workloads, also made a significant contribution.
The performance highlights how Google's investments in artificial intelligence are increasingly translating into actual business revenue, at a time when investors are questioning whether the industry's enormous spending on AI infrastructure will pay off.
How Google compares with AWS and Azure
Google's 103% growth puts it well ahead of its two biggest competitors, although it still has some catching up to do in terms of overall revenue.
Amazon Web Services (AWS), the world's largest cloud computing provider, reported third-quarter revenue of $46 billion, representing 39% growth year-over-year. Microsoft's Azure came second in growth, increasing revenue by 48% to approximately $33.2 billion.
The figures reveal an interesting shift in the cloud computing industry. While AWS continues to dominate in terms of revenue, Google is growing considerably faster as businesses increasingly turn to its infrastructure to develop, train and operate AI models.
AI is changing the cloud business
Cloud computing allows businesses to rent computing power, storage, and software over the internet instead of building and maintaining their own expensive infrastructure.
The growing popularity of generative AI has significantly increased demand for these services. Training and operating advanced AI models requires enormous computing resources, creating a lucrative opportunity for cloud providers.
Google has been particularly aggressive in positioning itself to benefit from this demand. Its TPUs offer customers an alternative to Nvidia's widely used AI processors, while its Gemini models and enterprise AI tools give businesses additional reasons to use Google Cloud.
The company also reported that its Google Cloud operating income more than tripled to $11.1 billion, up from $3.6 billion a year earlier, showing that the business is becoming more profitable alongside its rapid expansion.
