Tech giants Alphabet and Amazon have reported substantial profit boosts from their investments in artificial intelligence (AI) startup Anthropic, highlighting the growing financial impact of AI in the tech sector.

Alphabet's Gains

Alphabet, Google's parent company, saw a significant boost to its quarterly profit, which included $10.7 billion in net gains on equity securities. Sources indicate that a portion of these gains came from the company's investment in Anthropic. Google has made substantial commitments to the AI startup:

Additionally, Google Cloud has secured a major contract with Anthropic, agreeing to supply the startup with 1 million specialized AI chips starting in 2026. This deal is reportedly worth tens of billions of dollars, further cementing the relationship between the two companies.

Amazon's Anthropic Windfall

Amazon also reported impressive gains from its Anthropic investment:

The e-commerce and cloud computing giant has committed to an $8 billion investment in Anthropic. As part of this partnership, Amazon is building a network of data centers and custom AI chips for the startup.

Anthropic's Rapid Growth

The substantial gains reported by both Alphabet and Amazon reflect Anthropic's recent success in fundraising and valuation growth:

This significant increase in Anthropic's valuation underscores the high expectations and potential seen in the AI startup's technology and future prospects.

Microsoft's Contrasting AI Investment Outcome

While Alphabet and Amazon reported gains, Microsoft faced a different scenario with its AI investments:

This reduction was attributed to losses from Microsoft's investment in OpenAI, highlighting the potential volatility and risks associated with investments in the rapidly evolving AI sector.

The contrasting outcomes for these tech giants underscore the complex and potentially high-stakes nature of investments in artificial intelligence companies. As the AI industry continues to evolve, these strategic investments may play a crucial role in shaping the future of technology and the competitive landscape among major tech corporations.

Alphabet Inc., the parent company of Google, has achieved a significant milestone in its financial performance, marking its first-ever $100 billion quarterly revenue. The tech giant's latest earnings report has exceeded analyst expectations, leading to a surge in its stock price.

Financial Highlights

Alphabet's impressive performance was driven by strong results across its key business segments:

YouTube and Google Cloud Exceed Expectations

Both YouTube and Google Cloud revenues surpassed Wall Street projections. Notably, Google Cloud demonstrated robust growth, with revenue increasing by 35% to reach $15.15 billion.

Cloud Business Momentum

Google Cloud has shown significant traction in the enterprise market:

• Secured deals worth over $1 billion in the first nine months of the year
• More billion-dollar deals than in the previous two years combined
• Landed a substantial $10 billion contract from Meta

AI and Other Businesses

• Gemini AI app reached 650 million monthly active users, up from 450 million in the previous quarter
• Other businesses, including life sciences and Waymo, reported increased losses of $1.42 billion

Capital Expenditure and Stock Performance

• Full-year capex guidance raised to $91-93 billion from the previous $75-85 billion range
• Shares rose 6.3% in extended trading to $292.41
• Year-to-date gains stand at 45%

This strong performance demonstrates Alphabet's continued dominance in the tech sector and its ability to capitalize on growing trends in cloud computing and artificial intelligence. However, investors should note the increased losses in other business segments and the raised capital expenditure guidance, which may impact future profitability.