Alphabet Inc Class C (NASDAQ:GOOG) stock rose 5.57% (As on October 30, 11:36:36 AM UTC-4, Source: Google Finance) after the company reported third quarter revenue and earnings that surpassed Wall Street’s expectations following a slew of AI deals involving its cloud segment. The sales growth was driven by Google Cloud, which saw revenue rise 34% to $15.2 billion from $11.4 billion in the year ago period and was higher then the $14.8 billion projected by analysts. The segment’s backlog, or value of future revenue from customer contracts, rose to $155 billion during the third quarter. The company has have signed more deals over $1 billion through Q3 this year than we did in the previous two years combined.

Moreover, the company reported 32% cloud revenue growth from the year prior and is keeping pace with its megacap competitors. Pichai and Ashkenazi said the company has received more $1 billion deals in the last nine months than it had in the past two years combined. In August, Google won a $10 billion cloud contract from Meta spanning six years. Anthropic last week announced a deal that gives the artificial intelligence company access to up to 1 million of Google’s custom-designed Tensor Processing Units, or TPUs. The deal is worth tens of billions of dollars. The spend on infrastructure is also helping the company improve its own AI products. Google’s flagship AI app Gemini now has more than 650 million monthly active users. That’s up from the 450 million active users Pichai reported the previous quarter.

GOOG in the third quarter of FY25 has reported the adjusted earnings per share of $2.87, beating the analysts’ estimates for the adjusted earnings per share of $2.27. The company had reported the adjusted revenue growth of 16 percent to $102.4 billion in the third quarter of FY25, beating the analysts’ estimates for revenue of $99.85 billion, as per analysts by Bloomberg.

In addition, Google parent Alphabet is planning a “significant increase” in spend next year as it continues to invest in AI infrastructure to meet the demand of its customer backlog. The company now expects 2025 capital expenditures to be in a range of $91 billion to $93 billion. It marks the second time the company increased its capital expenditure this year. In July, the company increased its expectation from $75 billion to $85 billion, most of which goes toward investments in projects like new data centers.