Alphabet's cloud revenue doubles but heavy spending pushes cash flow negative again

Alphabet reported third-quarter revenue of about 128 billion dollars, up 25 percent. Google Cloud more than doubled to about 31 billion dollars. Capital spending reached about 51 billion dollars in the quarter. That pushed free cash flow below zero for the second quarter in a row. Diluted earnings came in at 2 dollars 12 cents per share.

Operating margin was 31.8 percent and net income 26.2 billion dollars. Over the trailing twelve months free cash flow is still positive at 19.7 billion. The quarter shows the trade-off the large clouds are making: very fast growth in AI-driven cloud demand, paid for with infrastructure spending that now exceeds what the business generates in cash.