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What changed in Alphabet Inc. (Class C)'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Alphabet Inc. (Class C)'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+386 added−425 removedSource: 10-K (2026-02-05) vs 10-K (2025-02-05)

Top changes in Alphabet Inc. (Class C)'s 2025 10-K

386 paragraphs added · 425 removed · 301 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeThat is why we continue to invest in platforms like our Android mobile operating system, Chrome browser, and Chrome operating system, as well as our family of devices. We see tremendous potential for devices to be helpful and make people's lives easier by combining the best of our AI, software, and hardware.
Biggest changeWe see tremendous potential for devices to be helpful and make people's lives easier by combining the best of our AI, software, and hardware. This potential is reflected in our latest generation of devices, such as the new Pixel 10 series and the Pixel Watch 4.
Further, corporate governance information, including our certificate of incorporation, bylaws, governance guidelines, board committee charters, and code of conduct, is also available on our investor relations website under the heading "Governance." The information contained on, or that may be accessed through our websites or our executive officers' social media channels, is not incorporated by reference into this Annual Report on Form 10-K or in any other report or document we file with the SEC, and any references to our websites are intended to be inactive textual references only.
Further, corporate governance information, including our certificate of incorporation, bylaws, corporate governance guidelines, board committee charters, and code of conduct, is also available on our investor relations website under the heading "Governance." The information contained on, or that may be accessed through our websites or our executive officers' social media channels, is not incorporated by reference into this Annual Report on Form 10-K or in any other report or document we file with the SEC, and any references to our websites are intended to be inactive textual references only. 8.
We face formidable competition in every aspect of our business, including but not limited to, from: • general purpose search engines and information services; • vertical search engines and e-commerce providers for queries on topics such as those related to travel, jobs, and health, which users may navigate directly to rather than go through Google; • online advertising platforms and networks, i ncluding online shopping and streaming services; • other forms of advertising, such as billboards, magazines, newspapers, radio, and television as our advertisers typically advertise in multiple media, both online and offline; • digital content and application platform providers; • providers of enterprise cloud services; • developers and providers of AI products and services; • companies that design, manufacture, and market consumer hardware products, including businesses that have developed proprietary platforms; • providers of digital video services; • social networks, which users may rely on for product or service referrals, rather than seeking information through traditional search engines; • providers of workspace communication and connectivity products; and • digital assistant providers.
We face formidable competition in every aspect of our business, including but not limited to, from: • general purpose search engines and information services; • vertical search engines and e-commerce providers for queries on topics such as those related to travel, jobs, and health, which users may navigate directly to rather than go through Google; • online advertising platforms and networks, i ncluding online shopping and streaming services; • other forms of advertising, such as billboards, magazines, newspapers, radio, and television, as our advertisers typically advertise in multiple media, both online and offline; • digital content and application platform providers; • providers of enterprise cloud services; • AI model developers and providers of AI products and services; • companies that design, manufacture, and market consumer hardware products, including businesses that have developed proprietary platforms; • providers of digital video services; • social networks, which users may rely on for product or service referrals, rather than seeking information through traditional search engines; and • providers of workspace communication and connectivity products. 6.
It led us to be a pioneer in the development of AI and, since 2016, an AI-first company. We continue this work under the leadership of Alphabet and Google CEO, Sundar Pichai. Alphabet is a collection of businesses — the largest of which is Google.
It led us to be a pioneer in the development of artificial intelligence (AI) and, since 2016, be an AI-first company. We continue this work under the leadership of Alphabet and Google CEO, Sundar Pichai. Alphabet is a collection of businesses — the largest of which is Google.
Government Regulation We are subject to numerous United States (U.S.) federal, state, and local, as well as foreign laws and regulations covering a wide variety of subjects, and the scope of this coverage continues to broaden with continuing new legal and regulatory developments in the U.S. and internationally.
Government Regulation We are subject to numerous United States (US) federal, state, and local, as well as foreign laws, and regulations covering a wide variety of subjects, and the scope of this coverage continues to broaden with continuing new legal and regulatory developments in the US and internationally.
Our compliance with these laws and regulations may be onerous and could, individually or in the aggregate, increase our cost of doing business, make our products and services less useful, limit our ability to pursue certain business practices or offer certain products and services, cause us to change our business models and operations, affect our competitive position relative to our peers, and/or otherwise harm our business, reputation, financial condition, and operating results.
Our compliance with these laws and regulations may be onerous and could, individually or in the aggregate, increase our cost of doing business, make our products and services less useful, limit our ability to pursue certain business practices or offer certain products and services (either in certain geographies or at all), cause us to change our business models and operations, affect our competitive position relative to our peers, or otherwise harm our business, reputation, financial condition, and operating results.
We webcast via our investor relations YouTube channel and website our earnings calls and certain events we participate in or host with members of the investment community.
We webcast our earnings calls, as well as certain events we participate in or host with members of the investment community, via our investor relations YouTube channel and website.
Other Bets operate as independent companies and some of them have their own boards with independent members and outside investors. While these early-stage businesses naturally come with considerable uncertainty, some of them are already generating revenue and making important strides in their industries. Revenues from Other Bets are generated primarily from the sale of healthcare-related services, and internet services.
Other Bets operate as independent companies and some of them have their own boards with independent members and outside investors. While these early-stage businesses naturally come with considerable uncertainty, some of them are already generating revenue and making important strides in their industries. Revenues from Other Bets are generated primarily from the sale of autonomous transportation and internet services.
As we have seen in recent years, different laws and regulations on the same topic may not always have the same requirements, and even when requirements overlap, the rules are not always consistently implemented, interpreted, and enforced from jurisdiction to jurisdiction.
As we have seen in recent years, different laws and regulations on the same topic may not always have the same requirements (and sometimes may seem to have conflicting requirements), and even when requirements overlap, the rules are not always consistently implemented, interpreted, and enforced from jurisdiction to jurisdiction.
We have also filed patent applications in the U.S. and foreign countries covering certain of our technology, and acquired patent assets to supplement our portfolio. We have licensed in the past, and expect that we may license in the future, certain of our rights to other parties.
We have also filed patent applications in the US and foreign countries covering certain of our technology, and acquired patent assets to supplement our portfolio. We have licensed in the past, and expect that we may license in the future, certain of our rights to other parties.
F or additional information about government regulation applicable to our business, see Item 1A Risk Factors; Trends in Our Business and Financial Effect in Part II, Item 7; and Legal Matters in Note 10 of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K.
F or additional information about government regulation applicable to our business, see Item 1A Risk Factors; Trends in Our Business and Financial Effect in Part II, Item 7; and Legal Matters in Note 10 of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K. 7. Table of Contents Alphabet Inc.
For example, for advertising, competing successfully depends on attracting and retaining: • users, for whom other products and services are literally one click away, largely on the basis of the relevance of our advertising, as well as the general usefulness, security, and availability of our products and services; • advertisers, primarily based on our ability to generate sales leads, and ultimately customers, and to deliver their advertisements in an efficient and effective manner across a variety of distribution channels; and • content providers, primarily based on the quality of our advertiser base, our ability to help these partners generate revenues from advertising, and the terms of our agreements with them. 8.
For example, for advertising, competing successfully depends on attracting and retaining: • users, for whom other products and services are literally one click away, on the basis of the relevance of our advertising, as well as the general usefulness, security, and availability of our products and services; • advertisers, primarily based on our ability to generate sales leads, and ultimately customers, and to deliver their advertisements in an efficient and effective manner across a variety of distribution channels even as trends in advertising mediums and user preferences change; and • content providers, primarily based on the quality of our advertiser base, our ability to help these partners generate revenues from advertising, and the terms of our agreements with them.
Particularly with regard to AI; competition; consumer protection; content moderation; data privacy and security; news publications; and sustainability and other social matters, we have seen an increase in new and evolving laws and regulations, as well as related enforcement actions and investigations, being proposed and implemented in recent years by legislative and regulatory bodies around the world.
Particularly with regard to AI; competition; consumer protection; content moderation, including access restrictions for minors; data privacy and security; intellectual property; news publications; and sustainability and other social matters, we have seen an increase in new and evolving laws and regulations, as well as related enforcement actions and investigations, being proposed and implemented in recent years by legislative and regulatory bodies around the world.
We provide a variety of high quality training and support to managers to build and strengthen their capabilities-–ranging from courses for new managers, to learning resources that help them provide feedback and manage performance, to coaching and individual support. As of December 31, 2024, Alphabet had 183,323 employees.
We provide a variety of high-quality training and support to managers to build and strengthen their capabilities — ranging from courses for new managers, to learning resources that help them provide feedback and manage performance, to coaching and individual support. As of December 31, 2025, Alphabet had 190,820 employees.
Google Services' core products and platforms include ads, Android, Chrome, devices, Gmail, Google Drive, Google Maps, Google Photos, Google Play, Search, and YouTube, with broad and growing adoption by users around the world. Our products and services have come a long way since the company was founded more than 25 years ago.
Google Services' core products and platforms include ads, Android, Chrome, devices, Gmail, Google Drive, Google Gemini, Google Maps, Google Photos, Google Play, Search, and YouTube, with broad and growing adoption by users around the world. 4. Table of Contents Alphabet Inc. Our products and services have come a long way since the company was founded more than 25 years ago.
Like other companies in the technology industry, we face increasingly heightened scrutiny from both U.S. and foreign governments with respect to our compliance with laws and 9. Table of Contents Alphabet Inc. regulations. Many of these laws and regulations are evolving and their applicability and scope, as interpreted by the courts, remain uncertain.
Like other companies in the technology industry, we face increasingly heightened scrutiny from both US and foreign governments with respect to our compliance with laws and regulations. Many of these laws and regulations are evolving and their applicability and scope, as interpreted by the courts, remain uncertain.
Table of Contents Alphabet Inc. Making AI Helpful for Everyone We believe AI is a profound platform shift, one that can bring meaningful and positive change to people and societies across the world, and to our business.
Making AI Helpful for Everyone We believe AI is a profound platform shift that can bring meaningful and positive change to people and societies across the world, and to our business.
In addition, Google Services increasingly generates revenues from products and services beyond advertising, including: • consumer subscriptions, which primarily include revenues from YouTube services, such as YouTube TV, YouTube Music and Premium, and NFL Sunday Ticket, as well as Google One; • platforms , which primarily include revenues from Google Play sales of apps and in-app purchases; and • devices, which primarily include sales of the Pixel family of devices.
In addition, Google Services generates revenues from products and services beyond advertising, including: • consumer subscriptions, which primarily include revenues from YouTube services, such as YouTube TV, YouTube Music and Premium, and NFL Sunday Ticket, as well as Google One, which offers access to our most capable Gemini models; • platforms , which primarily include revenues from Google Play sales of apps and in-app purchases; and • devices, which primarily include sales of the Pixel family of devices.
Competing successfully depends heavily on our ability to develop and distribute innovative products and technologies to the marketplace across our businesses.
Table of Contents Alphabet Inc. Competing successfully depends heavily on our ability to continually develop and distribute innovative products and technologies to the marketplace across our businesses.
Intellectual Property We rely on various intellectual property laws, confidentiality procedures and contractual provisions to protect our proprietary technology and our brand. We have registered, and applied for the registration of, U.S. and international trademarks, service marks, domain names, and copyrights.
Intellectual Property We rely on intellectual property such as trademarks, copyrights, patents, and trade secrets, as well as confidentiality procedures and contractual provisions, to protect our proprietary technology and our brand. We have registered, and applied for the registration of, US and international trademarks, service marks, domain names, and copyrights.
While Google Search started as a way to find web pages, organized into ten blue links, we have driven technical advancements and product innovations that have transformed Google Search into a dynamic, multimodal experience. We first expanded from traditional desktop browsers into mobile web search, making it easier to navigate on smaller screens.
While Google Search started as a way to find web pages, organized into ten blue links, we have driven technical advancements and product innovations that have transformed Google Search into a dynamic, multimodal experience.
We do this by continuously investing in building products that are secure by default; strictly upholding responsible data practices that emphasize privacy by design; and building easy-to-use settings that put people in control.
Privacy and Security We make it a priority to protect the privacy and security of our products, users, and customers, even if there are near-term financial consequences. We do this by continuously investing in building products that are secure by default; strictly upholding responsible data practices that emphasize privacy by design; and building easy-to-use settings that put people in control.
We report Google in two segments, Google Services and Google Cloud, and all non-Google businesses collectively as Other Bets. Supporting these businesses, we have centralized certain AI-related research and development which is reported in Alphabet-level activities. Alphabet's structure is about helping each of our businesses prosper through strong leaders and independence.
We report Google in two segments, Google Services and Google Cloud, and all non-Google businesses collectively as Other Bets. Supporting these businesses, we have centralized certain AI-related research and development focused on advanced research in AI and developing the frontier models that serve our businesses, which is reported in Alphabet-level activities.
Our people are critical for our continued success, so we work hard to create an environment where employees can have fulfilling careers, and be happy, healthy, and perform at a high level.
For additional information about competition, see Item 1A Risk Factors of this Annual Report on Form 10-K. Culture and Workforce Our people are critical for our continued success, so we work hard to create an environment where employees can have fulfilling careers and perform at a high level.
How We Make Money We have built world-class advertising technologies for advertisers, agencies, and publishers to power their digital marketing businesses.
Creating products and services that people rely on every day is a journey that we are investing in for the long-term. How We Make Money We have built world-class advertising technologies for advertisers, agencies, and publishers to power their digital marketing businesses.
Deliver the Most Advanced, Safe, and Responsible AI We aim to build the most advanced, safe, and responsible AI through a full stack of robust AI-optimized infrastructure, including data centers, chips, and a global fiber network; world class research teams; and a broad global reach through products and platforms that touch billions of people and customers around the world.
We aim to build the most advanced, safe, and responsible AI through our full-stack approach, which spans AI-optimized infrastructure; world-class research, including models and tooling; and our products and platforms that bring AI to billions of people, developers, and enterprises.
Google Cloud helps customers solve today’s business challenges, improve productivity, reduce costs, and unlock new growth engines. We are continually innovating and building new products and features to help our users, partners, customers, and communities and have invested more than $150 billion in research and development in the last five years in support of these efforts. 4.
We continually innovate and build new products and features to help our users, partners, customers, and communities and have invested more than $200 billion in research and development in the last five years in support of these efforts. 3. Table of Contents Alphabet Inc.
Since then, we have evolved from a company that helps people find answers to a company that also helps people get things done. We are focused on building an even more helpful Google for everyone, and we aspire to give everyone the tools they need to increase their knowledge, health, happiness, and success.
We are focused on building an even more helpful Google for everyone, and we aspire to give everyone the tools they need to increase their knowledge, health, happiness, and success. Google Search helps people find information and make sense of the world in more natural and intuitive ways, with trillions of searches on Google every year.
For example, with Circle to Search built directly into the Android experience, users can search anything they see on their phone using a simple gesture. Moonshots Many companies get comfortable doing what they have always done, making only incremental changes. This incrementalism leads to irrelevance over time, especially in technology, where change tends to be revolutionary, not evolutionary.
That means developing AI in a way that maximizes the positive benefits to society while addressing its potential challenges. Moonshots Many companies get comfortable doing what they have always done, making only incremental changes. This incrementalism leads to irrelevance over time, especially in technology, where change tends to be revolutionary, not evolutionary.
Table of Contents Alphabet Inc. reading books, and using apps. Working with content creators and partners, we continue to build new ways for people around the world to create and find great digital content. Fueling all of these great digital experiences are extraordinary platforms and devices.
People are consuming many forms of digital content, including watching long and short form videos and podcasts, streaming TV, playing games, listening to music, reading books, and using apps. Working with content creators and partners, we continue to build new ways for people around the world to create and find great digital content.
We choose our partners and staffing agencies carefully, and review their compliance with Google’s Supplier Code of Conduct.
The employees of our suppliers and staffing partners — vendors and temporary staff, respectively — and independent contractors who are self-employed, make up our extended workforce. We choose our partners and staffing agencies carefully, and review their compliance with Google’s Supplier Code of Conduct.
Our early investments in AI started out as moonshots but are now incorporated into our core products and central to future developments. We continue to look toward the future and to invest for the long term, most notably for the application of AI to our products and services, as well as other frontier technologies such as quantum computing.
Isomorphic Labs is reimagining the drug discovery process from first principles, applying AI to accelerate the development of new medicines. We continue to look toward the future and to invest for the long term, most notably for the application of AI to our products and services, as well as other frontier technologies such as quantum computing.
We took that a step further with multisearch, which lets people search with text and images at the same time. Large language models have made it possible to express more natural language queries, vastly improving the types of questions users can ask, and the quality of results.
Large language models have made it possible to express more natural language queries, vastly improving the types of questions users can ask, and the quality of results. For example, AI Overviews makes it easier to ask Google anything and get a helpful response.
Google Cloud Through our Google Cloud Platform and Google Workspace offerings, Google Cloud generates revenues primarily from consumption-based fees and subscriptions for infrastructure, platform, applications, and other cloud services.
Google Cloud Through our Google Cloud Platform and Google Workspace offerings, Google Cloud generates revenues primarily from consumption-based fees and subscriptions for infrastructure, platform, applications, and other cloud services. Customers use Google Cloud in multiple ways such as: 5. Table of Contents Alphabet Inc. • AI-optimized Infrastructure: runs on our Cloud, at the edge, or in customers' data centers.
Access and Technology for Everyone The Internet is one of the world’s most powerful equalizers; it propels ideas, people, and businesses large and small. Our mission to organize the world’s information and make it universally accessible and useful is as relevant today as it was when we were founded in 1998.
Our mission to organize the world’s information and make it universally accessible and useful is as relevant today as it was when we were founded in 1998. Since then, we have evolved from a company that helps people find answers to a company that also helps people get things done.
This drive to make information more accessible and helpful has led us over the years to improve the discovery and creation of digital content both on the web and through platforms like Google Play and YouTube. People are consuming many forms of digital content, including watching videos, streaming TV, playing games, listening to music, 6.
AI Mode allows users to ask more nuanced questions that might have previously taken multiple searches, using Gemini’s advanced reasoning, thinking, and multimodal capabilities. This drive to make information more accessible and helpful has led us over the years to improve the discovery and creation of digital content both on the web and through platforms like Google Play and YouTube.
We have work councils and statutory employee representation obligations in certain countries, and we are committed to supporting protected labor rights, maintaining an open culture, and listening to all employees. Supporting healthy and open dialogue is central to how we work, and we communicate information about the company through multiple internal channels to our employees.
We have work councils and statutory employee representation obligations in certain countries, and we are committed to supporting protected labor rights, maintaining an open culture, and listening to our employees. When appropriate we partner with outside companies on a contractual basis to provide a specialized service or to temporarily cover a short-term need.
Google Search helps people find information and make sense of the world in more natural and intuitive ways, with trillions of searches on Google every year. YouTube provides people with entertainment, information, and opportunities to learn something new and helps support the creator economy through the YouTube Partner Program.
YouTube provides people with entertainment, information, and opportunities to learn something new and helps support the creator economy through the YouTube Partner Program. Google Cloud helps customers build for the future, improve productivity, reduce costs, and unlock new growth engines.
Alphabet’s investment in the portfolio of Other Bets includes businesses that are at various stages of development, ranging from those in the R&D phase to those that are in the beginning stages of commercialization. Our goal is for them to become thriving, successful businesses.
Alphabet’s investment in the portfolio of Other Bets includes businesses that are at various stages of development, ranging from those in the research and development phase, such as X, our moonshot factory focused on developing breakthrough technologies, to those that are scaling commercialization, such as Waymo, which is expanding to more cities domestically, entering international markets, and further scaling operations.
Our AI-optimized infrastructure allows us to use, and offer our customers, a range of AI accelerator options, including our own custom-built Tensor Processing Units (TPUs). Our teams across Alphabet leverage Gemini, as well as other AI models we have previously developed and announced, to deliver the best product and service experiences for our users, advertisers, partners, customers, and developers.
Our technical infrastructure allows us to use and offer our customers a range of AI accelerator options, including specialized Graphics Processing Units (GPUs) and our own custom-built Tensor Processing Units (TPUs), such as Ironwood, our seventh-generation TPU.
Our acquisitions of YouTube and Android and subsequent launch of Chrome have matured into major platforms for digital video and mobile devices and a safer, popular browser. In Other Bets, our fully autonomous driving technology company, Waymo, is now providing fully autonomous, paid ride-hailing services to customers in multiple cities.
Our early investments in AI started out as moonshots but are now incorporated into our core products and central to future developments. In Other Bets, our fully autonomous driving technology company, Waymo, is now providing fully autonomous, paid ride-hailing services to customers in multiple cities.
It can be used to migrate and modernize IT systems and to train and serve various types of AI models. • Developer Platform: provides developers, through the Vertex AI platform, the ability to train, tune, augment, test, and deploy applications using Gemini and other leading generative AI models.
It can be used to migrate and modernize information technology (IT) systems and to train and serve various types of AI models. Our AI infrastructure delivers cost-performance for AI workloads.
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At Google, we have been bringing AI into our products and services for more than a decade and making them available to our users. In 2023, we took a significant step on our journey to make AI more helpful for everyone with the introduction of Gemini, our natively multimodal AI model.
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Alphabet's structure is about helping each of our businesses prosper through strong leaders and independence. Access and Technology for Everyone The Internet is one of the world’s most powerful equalizers; it propels ideas, people, and businesses large and small.
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In 2024, we launched Gemini 2.0, our most capable model yet. Gemini can generalize and seamlessly understand, operate across, and combine different types of information including text, code, audio, image, and video. Gemini is powering AI features across our products and services that are helping people everyday.
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At the foundation of our full-stack approach is our AI-optimized infrastructure — a key differentiator enabling us to power our own products, such as Search and YouTube, and support the services we provide to our Google Cloud customers.
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Today, all seven of our two billion-user products — Android, Chrome, Gmail, Maps, Play Store, Search, and YouTube — are using Gemini. Our Google Cloud products, including Google Cloud Platform and Google Workspace, help organizations stay at the forefront of innovation with our AI-optimized infrastructure, AI development platform, world-class models, as well as assistive agents and applications.
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We are focused on driving efficiencies in our data centers, allowing us to leverage our technical infrastructure to deliver our products and services at an increasing scale while simultaneously enabling world-class research and model development.
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We believe AI has the potential to solve important societal, scientific, and engineering challenges. For example, in 2020, Google DeepMind’s AlphaFold system solved a 50-year-old protein folding challenge, and in 2024, we introduced AlphaFold 3, built on the previous models, to predict the structure and interactions of all the molecules in life's processes.
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Over the last decade, our research teams have pushed the boundaries of AI forward, which is displayed through Gemini 3, our most intelligent AI model yet. Designed to deliver advanced multimodal understanding, Gemini 3 represents our most capable iteration of agentic and generative coding technologies.
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We are focused on transforming our products to provide the most helpful tools to our users and customers as we deliver on our mission to organize the world’s information and make it universally accessible and useful.
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Gemini 3 integrates enhanced reasoning capabilities to support visualizations and interactive user experiences across our product ecosystem, including Search and the Gemini app. As technology continues to improve rapidly, we are focused on bringing our latest AI advances to our products and platforms.
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We are driving efficiencies in our data centers, while making significant hardware and model improvements. For example, since we started serving AI Overviews to our users, we have significantly lowered machine costs and latency through hardware, engineering, and technical breakthroughs.
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We continue to help our users access information and knowledge, express themselves, and get things done by embedding the power of generative AI and Gemini into our products and platforms. Today, all 15 of our half-billion-user products — including seven with two billion users — use our Gemini models.
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We are using Gemini 2.0 in new research prototypes, including Project Astra, which explores the future capabilities of a universal AI assistant and Project Mariner, an early prototype capable of taking actions in Chrome as an experimental extension. We believe our approach to AI must be both bold and responsible.
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For our Google Cloud customers, our offerings are helping organizations stay at the forefront of innovation with solutions such as Gemini Enterprise and Gemini for Google Workspace. Guided by our AI principles, we believe our approach to AI must be both bold and responsible.
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That means developing AI in a way that maximizes the positive benefits to society while addressing its potential challenges, guided by our AI Principles. Enable Organizations and Developers to Innovate on Google Cloud AI is a major technology shift for enterprises. Globally, businesses from startups to large enterprises, and the public sector are thinking about how to drive transformation.
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Fueling all of these great digital experiences are extraordinary platforms and devices. That is why we continue to invest in platforms like our Android mobile operating system, Chrome browser, and Chrome operating system, as well as our family of devices.
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That is why we are focused on making it easy and scalable for others to innovate, and grow, with AI. That means providing advanced computing infrastructure and expanding access to Google’s latest AI models. Our Vertex AI platform gives developers the ability to train, tune, augment, test, and deploy applications using Gemini, Imagen, Veo, and other generative AI models.
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We offer a range of AI accelerators, including our custom TPUs and specialized GPUs, as well as AI-optimized storage offerings, and efficient AI software. • Developer Platform: delivers a fully managed AI development platform, through Vertex AI, for accessing, tuning, augmenting, and deploying custom models and agents, helping customers build applications with more than 200 foundation models, including our Gemini family, third-party, and open models. • Cybersecurity: provides AI-powered threat intelligence and cybersecurity solutions to help customers detect, analyze, protect against, and respond to a broad range of cybersecurity threats. • Data and Analytics: enables customers to migrate, clean, prepare, and feed data into their models.
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Gemini for Google Cloud provides pre-packaged AI agents that can assist developers to write, document, test, and operate software as well as assist cybersecurity teams to analyze, detect, protect, and respond to threats. Improve Knowledge, Learning, Creativity, and Productivity As AI continues to improve rapidly, we are focused on transforming our products to provide our users the most helpful tools.
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Our data platform also unifies data lakes, data warehouses, data governance, and advanced machine learning into a single platform that helps users analyze data using AI models across any cloud. • Agents: ◦ Gemini Enterprise: empowers teams to discover, create, share, and run AI agents all in one secure platform, bringing the best of Google AI to employees through an intuitive chat interface, helping to automate workflows and drive smarter business outcomes. ◦ Gemini for Google Workspace: brings our AI-powered agents into Gmail, Docs, Sheets, and more to help users write, organize, visualize, accelerate workflows, and have more productive meetings.
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Examples include AI Overviews, which allow users to ask their most complex questions, break down concepts in a format that is useful for them, or take a video and ask a question out loud, and NotebookLM, which helps users understand complex information by summarizing sources and providing relevant quotes.
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We are embedding the power of generative AI to continue helping our users express themselves and get things done. For example, the Gemini app allows users to collaborate with new AI features that include image generation capabilities, coding support, and app integration. Gemini for Google Workspace helps users write, organize, visualize, accelerate workflows, and have richer meetings.
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Additionally, we are using Gemini to improve recommendations on YouTube. We also know businesses of all sizes around the world rely on Google Ads to find customers and grow their businesses — and we 5. Table of Contents Alphabet Inc. make that even easier with AI.
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For example, advertisers are able to use our updated image generation in Google Ads to produce high-quality imagery for their campaigns, and Demand Gen helps them reach their target audiences. Build the Most Helpful Personal Computing Platforms and Devices Over the years, our Pixel phones have incorporated AI compute directly into the device and built experiences on top of it.
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Our latest Pixel devices were built with Gemini Nano, bringing the best AI-assistive experiences to our users, such as Gemini on Pixel, Pixel Screenshots, and Pixel Studio. Our Android and Chrome operating systems enable users to access Gemini, and other Google AI features throughout their day.
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As we said in the original founders' letter, we will not shy away from high-risk, high-reward projects that we believe in, as they are the key to our long-term success. Privacy and Security We make it a priority to protect the privacy and security of our products, users, and customers, even if there are near-term financial consequences.
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As new types of content surfaced on the internet, Universal Search made it possible to search multiple content types, like news, images, videos, and more, to deliver rich, relevant results. The introduction of new search modalities, like voice and visual search, made it easier for people to express their curiosity in natural and intuitive ways.
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Each advancement has made it easier and more natural for people to find what they are looking for. We are now using Gemini customized for Google Search to provide our users an improved Search experience, and AI Overviews has been released in more than one hundred countries, reaching more than one billion users.
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This potential is reflected in our latest generation of devices, such as the new Pixel 9 series and the Pixel Watch 3. Creating products and services that people rely on every day is a journey that we are investing in for the long-term.
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Customers use Google Cloud in multiple ways such as: • AI-optimized Infrastructure: provides open, reliable, and scalable compute, networking, and storage to enable customers to run workloads anywhere — on our Cloud, at the edge, or in their data centers.
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We offer widely used first-party, third-party, and open models along with services such as vector search, grounding, and distillation to further improve the cost and quality of models. • Cybersecurity: provides AI powered cybersecurity solutions to help customers analyze, detect, protect, and respond to a broad range of cybersecurity threats, to further strengthen security outcomes, prioritize which threats to investigate, and identify attack paths, as well as accelerate resolution of cybersecurity threats. 7.
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Table of Contents Alphabet Inc. • Data and Analytics: provides a variety of different types of databases — relational, key-value, and in-memory — to store and manage data for different types of applications and deliver data to AI agents.
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Our data platform also unifies data lakes, data warehouses, data governance, and advanced machine learning into a single platform that helps users analyze data using AI models across any cloud. • Applications: offers a broad applications portfolio, including Gemini for Google Cloud and Gemini for Google Workspace, as well as purpose-built agents for Search and our Customer Engagement Suite.
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AI has been used in Google Workspace for years to improve grammar, efficiency, security, and more with features like Smart Reply, Smart Compose, and malware and phishing protection in Gmail. Now, Gemini for Google Workspace brings our AI-powered agents into Gmail, Docs, Sheets and more to help users write, organize, visualize, accelerate workflows, and have richer meetings.
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Table of Contents Alphabet Inc. For additional information about competition, see Item 1A Risk Factors of this Annual Report on Form 10-K.
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Ongoing Commitment to Sustainability Our environmental strat egy has two key pillars, supported by our dedication to accessible information and technological innovation: • Our products: We are empowering people with information about the environmental impacts of their choices. • Our operations: We are working to drive sustainability and efficiency across our operations and value chain.
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Through our products, we have an aspiration to help individuals, cities, and other partners collectively reduce one gigaton of their carbon equivalent emissions annually by 2030. In 2021, we set an ambitious goal to reach net-zero emissions across all of our operations and value chain by 2030.
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To make progress toward this effort, we aim to reduce 50% of our combined Scope 1, Scope 2 (market-based), and Scope 3 absolute emissions (compared to our 2019 base year) by 2030, and we plan to invest in nature-based and technology-based carbon removal solutions to neutralize our remaining emissions.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeFurther, at the federal and state level, there have been various proposals (and in some cases laws enacted) addressing “deepfakes” and other AI-generated synthetic media. • Data privacy, collection, processing, and portability: Laws and regulations further restricting the collection, processing, and/or sharing of user or advertising-related data, including privacy and data protection laws; laws affecting the processing of children's data (as discussed further below), data breach notification laws; laws limiting data transfers (including data localization laws); and laws requiring data portability (including the EU Data Act, as discussed further below). • Copyright and other intellectual property: Copyright and related laws, including the EU Directive on Copyright in the Digital Single Market and European Economic Area transpositions, which have introduced new licensing regimes, increase liability with respect to content uploaded by users or linked to from our platforms, or create property rights in news publications that could require payments to news agencies and publishers, which may result in other regulatory actions. • Content moderation: Various laws covering content moderation and removal, and related disclosure obligations, such as the EU's Digital Services Act, Florida’s Senate Bill 7072 and Texas’ House Bill 20, and laws and proposed legislation in Singapore, Australia, and the United Kingdom that impose penalties for failure to remove certain types of content or require disclosure of information about the operation of our services and algorithms, which may make it harder for services like Google Search and YouTube to detect and deal with low-quality, deceptive, or harmful content, or on the other hand, may impinge on the rights of free expression, which, in turn, could impact how our platforms are viewed by users.
Biggest changeTable of Contents Alphabet Inc. • Data privacy, collection, processing, and portability: Laws and regulations further restricting the collection, processing, or sharing of user or advertising-related data, including privacy and data protection laws; laws affecting the processing of children's data (as discussed further below), data breach notification laws; laws limiting data transfers (including data localization laws); laws limiting use of data for AI training; and laws requiring data portability. • Copyright and other intellectual property: Copyright and related laws, including the EU Directive on Copyright in the Digital Single Market and European Economic Area transpositions, which have introduced new licensing regimes, increase liability with respect to content uploaded by users or linked to from our platforms, or create property rights in news publications that could require payments to news agencies and publishers, which may result in other regulatory actions.
For instance, we may be subject to government audits and cost reviews, and any failure to comply or any deficiencies found may expose us to legal, financial, and/or reputational risks.
For instance, we may be subject to government audits and cost reviews, and any failure to comply or any deficiencies found may expose us to legal, financial, and reputational risks.
For example, if we fail to respond appropriately to the sharing of misinformation or objectionable content on our services and/or products or objectionable practices by advertisers, or otherwise to adequately address user concerns, our users may lose confidence in our brands. Furthermore, failure to maintain and enhance our brands could harm our business, reputation, financial condition, and operating results.
For example, if we fail to respond appropriately to the sharing of misinformation or objectionable content on our services or products or objectionable practices by advertisers, or otherwise to adequately address user concerns, our users may lose confidence in our brands. Furthermore, failure to maintain and enhance our brands could harm our business, reputation, financial condition, and operating results.
In order to implement AI responsibly and minimize unintended harmful effects, we have already devoted and will continue to invest significant resources to develop, test, and maintain our products and services, but we may not be able to identify or resolve all AI-related issues, deficiencies, and/or failures before they arise.
In order to implement AI responsibly and minimize unintended harmful effects, we have already devoted and will continue to invest significant resources to develop, test, and maintain our products and services, but we may not be able to identify or resolve all AI-related issues, deficiencies, and failures before they arise.
Additionally, our products incorporate highly technical and complex technologies, and thus our technologies and software have contained, and are likely in the future to contain, undetected errors, bugs, and/or vulnerabilities.
Additionally, our products incorporate highly technical and complex technologies, and thus our technologies and software have contained, and are likely in the future to contain, undetected errors, bugs, or vulnerabilities.
Systems and control failures, security breaches, failure to comply with our privacy policies, and/or inadvertent disclosure of user data could result in regulatory and legal exposure, seriously harm our reputation, brand, and business, and impair our ability to attract and retain users or customers.
Systems and control failures, security breaches, failure to comply with our privacy policies, and inadvertent disclosure of user data could result in regulatory and legal exposure, seriously harm our reputation, brand, and business, and impair our ability to attract and retain users or customers.
We may experience security and/or privacy issues, whether due to employee or insider error or malfeasance, system errors, or vulnerabilities in our or other parties’ systems.
We may experience security and privacy issues, whether due to employee or insider error or malfeasance, system errors, or vulnerabilities in our or other parties' systems.
New or changing laws and regulations, or interpretations or applications of existing laws and regulations in a manner inconsistent with our interpretations of such laws and regulations and/or our practices, have resulted in, and may continue to result in, less useful products and services, altered business models and operations, limited ability to pursue certain business practices or offer certain products and services, substantial costs, and civil or criminal liability.
New or changing laws and regulations, or interpretations or applications of existing laws and regulations in a manner inconsistent with our interpretations of such laws and regulations or our practices, have resulted in, and may continue to result in, less useful products and services, altered business models and operations, limited ability to pursue certain business practices or offer certain products and services, substantial costs, and civil or criminal liability.
Our share repurchases or dividends could affect our share trading prices, increase their volatility, reduce our cash reserves and may be suspended or terminated at any time, which may result in a decrease in the trading prices of our stock. The concentration of our stock ownership limits our stockholders’ ability to influence corporate matters.
Our share repurchases and dividends could affect our share trading prices, increase their volatility, reduce our cash reserves and may be suspended or terminated at any time, which may result in a decrease in the trading prices of our stock. The concentration of our stock ownership limits our stockholders' ability to influence corporate matters.
Our acquisitions and other strategic arrangements could also result in dilutive issuances of our equity securities, the incurrence of debt, contingent liabilities, or amortization expenses, or impairment of goodwill and/or purchased long-lived assets, and restructuring charges, any of which could harm our financial condition and operating results.
Our acquisitions and other strategic arrangements could also result in dilutive issuances of our equity securities, the incurrence of debt, contingent liabilities, or amortization expenses, or impairment of goodwill or purchased long-lived assets, and restructuring charges, any of which could harm our financial condition and operating results.
Because the techniques used to obtain unauthorized access to, disable or degrade service provided by or otherwise sabotage systems change frequently and often are recognized only after being launched against a target, even taking all reasonable precautions, including those required by law, we have been unable in the past and may continue to be unable to anticipate or detect attacks or vulnerabilities or implement adequate preventative measures.
Because the techniques used to obtain unauthorized access to, disable, or degrade service provided by or otherwise sabotage systems change frequently and often are recognized only after being launched against a target, even taking all reasonable precautions, including those required by law, we have been unable in the past and may continue to be unable to anticipate or detect certain attacks or vulnerabilities or implement adequate preventative measures.
Evolving laws and regulations may require us to make new capital investments, build new products, and seek partners to deliver localized services in other countries, and we may not be able to meet sovereign operating requirements. Within Other Bets, we are investing significantly in areas such as health, life sciences, and transportation, among others.
Evolving laws and regulations may require us to make new capital investments, build new products, and seek partners to deliver localized services in other countries, and we may not be able to meet sovereign operating requirements. Within Other Bets, we are investing significantly in areas such as life sciences and transportation, among others.
Additionally, other companies may develop AI products and technologies that are similar or superior to our technologies or more cost-effective to develop and/or deploy. Other companies may also have (or in the future may obtain) patents or other proprietary rights that would prevent, limit, or interfere with our ability to make, use, or sell our own AI products and services.
AI products and technologies that are similar or superior to our technologies or more cost-effective to develop or deploy. Other companies may also have (or in the future may obtain) patents or other proprietary rights that would prevent, limit, or interfere with our ability to make, use, or sell our own AI products and services.
Also, the anticipated benefits or value of our acquisitions and other strategic arrangements may not materialize. In connection with our divestitures and certain other strategic arrangements, we have agreed, and may in the future agree, to provide indemnification for certain potential liabilities, which could harm our financial condition and operating results.
Also, the anticipated benefits or value of our acquisitions, investments, and other strategic arrangements may not materialize. In connection with our divestitures and certain strategic arrangements, we have agreed, and may in the future agree, to provide indemnification for certain potential liabilities, which could harm our financial condition and operating results.
In addition, technologies have been developed that make personalized ads more difficult, or that block the display of ads altogether, and some providers of online services have integrated technologies that could potentially impair the availability and functionality of third-party digital advertising.
In addition, technologies have been developed that make personalized ads more difficult, or that block the display of ads altogether, and some providers of online services have integrated technologies that could impair the availability and functionality of third-party digital advertising.
These could harm existing key relationships, including with our users, customers, advertisers, and/or content providers, and impair our ability to attract new ones; harm our reputation; and increase costs, thereby negatively affecting our business.
These could harm existing key relationships, including with our users, customers, advertisers, and content providers, and impair our ability to attract new ones; harm our reputation; and increase costs, thereby negatively affecting our business.
Our revenue growth rate could decline over time as a result of a number of factors, including changes in the devices and modalities used to access our products and services; changes in geographic mix; deceleration or declines in advertiser spending; competition; changes in customer usage and demand for our existing products and increasing demand for new technologies; decreases in the pricing of our products and services; ongoing product and policy changes; and shifts to lower priced products and services.
Our revenue growth rate could decline over time as a result of a number of factors, including changes in customer usage and demand for our existing products and increasing demand for competing technologies; changes in the devices and modalities used to access our products and services; changes in geographic mix; deceleration or declines in advertiser spending; competition; decreases in the pricing of our products and services; ongoing product and policy changes; and shifts to lower priced products and services.
For example, the development and implementation of AI technologies may further increase our exposure to or exacerbate the risks of cyber attacks or other security incidents, particularly where such technologies are exploited by third parties to breach our or other parties’ systems, including when such technologies are used to target our employees or impersonate members of senior management in order to gain unauthorized access to our systems.
The development and implementation of AI technologies may further increase our exposure to or exacerbate the risks of cyber attacks or other security incidents, particularly where such technologies are exploited by third parties to breach our or other parties' systems, including when such technologies are used to target our employees or impersonate members of senior management in order to gain unauthorized access to our systems.
Adverse results in any of these lawsuits may include awards of monetary damages, costly royalty or licensing agreements (if licenses are available at all), or orders limiting our ability to sell our products and services in the U.S. or elsewhere, including by preventing us from offering certain features, functionalities, products, or services in certain jurisdictions.
Adverse results in any of these lawsuits may include awards of monetary damages, costly royalty or licensing agreements (if licenses are available at all), or orders limiting our ability to sell our products and services in the US or elsewhere, including by preventing us from offering certain features, functionalities, products, or services in certain jurisdictions.
ITEM 1A. RISK FACTORS Our operations and financial results are subject to various risks and uncertainties, including but not limited to those described below, which could harm our business, reputation, financial condition, and operating results, and affect the trading price of our Class A and Class C stock.
ITEM 1A. RISK FACTORS Our operations and financial results are subject to various risks and uncertainties, including but not limited to those described below, which could harm our business, reputation, financial condition, and operating results, and may affect the trading price and price volatility of our Class A and Class C stock.
Innovations in our products and services could also result in changes to user behavior and affect our revenue trends.
Innovations in our products and services could also result in changes to user and customer behavior and affect our revenue trends.
Malicious software such as viruses, software bugs, theft, misuse, defects, vulnerabilities in our products and services, as well as cyber attacks, phishing schemes, and other types of security breaches expose us to a risk of loss or improper use and disclosure of such information, which could result in litigation and other potential liabilities, including regulatory fines and penalties, as well as reputational harm.
Malicious software such as viruses, software bugs, theft, misuse, defects, vulnerabilities in our products and services, as well as cyber attacks, phishing schemes, and other types of security attacks, which increasingly use AI, expose us to a risk of loss or improper use and disclosure of such information, which could result in litigation and other potential liabilities, including regulatory fines and penalties, as well as reputational harm.
We are subject to numerous U.S. federal and state as well as foreign laws and regulations covering a wide variety of subjects, and our introduction of new businesses, products, services, and technologies will likely continue to subject us to additional laws and regulations.
We are subject to numerous US federal and state as well as foreign laws and regulations covering a wide variety of subjects, and our introduction of new businesses, products, services, and technologies will likely continue to subject us to additional laws and regulations.
Although we hedge a portion of our international currency exposure, significant fluctuations in exchange rates between the U.S. dollar and foreign currencies have in the past and may in the future adversely affect our revenues and earnings. Hedging programs are also inherently risky and could expose us to additional risks that could harm our financial condition and operating results.
Although we hedge a portion of our international currency exposure, significant fluctuations in exchange rates between the US dollar and foreign currencies have and may in the future adversely affect our revenues and earnings. Hedging programs are also inherently risky and could expose us to additional risks that could harm our financial condition and operating results.
Failing to provide superior value or deliver advertisements effectively and competitively could harm our business, reputation, financial condition, and operating results. In addition, expenditures by advertisers tend to correlate with overall economic conditions.
Failing to provide superior value or deliver advertisements effectively and competitively could harm our business, reputation, financial condition, and operating results. Expenditures by advertisers tend to correlate with overall economic conditions.
Furthermore, due to shifting economic and political conditions, tax policies, laws, or rates in various jurisdictions may be subject to significant changes in ways that could harm our financial condition and operating results.
Further, due to shifting economic and political conditions, tax policies, laws, or rates in various jurisdictions may be subject to significant changes in ways that could harm our financial condition and operating results.
All of our executive officers and key employees are at-will employees, and we do not maintain any key-person life insurance policies. In addition, we believe that our corporate culture fosters innovation, creativity, and teamwork.
All of our executive officers and key employees are at-will employees, and we do not maintain any key-person life insurance policies. We believe that our corporate culture fosters innovation, creativity, and teamwork.
We, like others in the industry, face violations of our content guidelines across our platforms, including sophisticated attempts by bad actors to manipulate our hosting and advertising systems to fraudulently generate revenues, or to otherwise generate traffic that does not represent genuine user interest or intent.
We, like others in the industry, face violations of our content guidelines across our platforms, including sophisticated attempts by bad actors to manipulate our hosting and advertising systems to fraudulently generate revenues, or to otherwise generate traffic that does not represent genuine user interest or intent. While we invest 14.
Other regulatory agencies in the U.S. and around the world, including competition enforcers, consumer protection agencies, and data protection authorities, have challenged and may continue to challenge our business practices and compliance with laws and regulations. We are cooperating with these investigations and defending litigation or appealing decisions where appropriate.
Other regulatory agencies in the US and around the world, including competition enforcers, consumer protection agencies, and data protection authorities, have challenged and may continue to challenge our business practices and compliance with laws and regulations. We are cooperating with these investigations and defending litigation or appealing decisions where appropriate.
We rely on third parties to supply components and distribute our products and services.
We also rely on third parties to supply components and distribute our products and services.
Our ability to compete effectively and our future success depend on our continuing to identify, hire, develop, motivate, and retain highly skilled personnel for all areas of our organization. Competition in our industry for qualified employees is intense, and certain of our competitors have directly targeted, and may continue to target, our employees.
Our ability to compete effectively and our future success depend on our continuing to identify, hire, develop, motivate, and retain highly skilled personnel for all areas of our organization. Competition in our industry for qualified employees, particularly AI talent, is intense, and certain of our competitors have directly targeted, and may continue to target, our employees.
Department of Justice (DOJ), various U.S. states, and other plaintiffs have filed, and may continue to file in the future, several antitrust lawsuits about various aspects of our business, including our advertising technologies and practices, the operation and distribution of Google Search, and the operation and distribution of the Android operating system and Play Store.
The US Department of Justice (DOJ), various states, and other plaintiffs have filed, and may continue to file in the future, several antitrust lawsuits about aspects of our business, including our advertising technologies and practices, the operation and distribution of Google Search, and the operation and distribution of Android operating system and Play Store.
Some jurisdictions have adopted regulations prohibiting certain forms of discrimination by internet access providers; however, substantial uncertainty exists in the U.S. and elsewhere regarding such protections. In addition, in some jurisdictions, our products and services have been subject to government-initiated restrictions or blockages.
Some jurisdictions have adopted regulations prohibiting certain forms of discrimination by internet access providers; however, substantial uncertainty exists in the US and elsewhere regarding such protections. In addition, in some jurisdictions, our products and services have been subject to government-initiated restrictions or blockages.
For example, we rely on statutory safe harbors, like those set forth in the Digital Millennium Copyright Act and Section 230 of the Communications Decency Act in the U.S. and the Digital Services Act in Europe, to protect against liability for various linking, caching, ranking, recommending, and hosting activities.
For example, we rely on statutory safe harbors, like those set forth in the Digital Millennium Copyright Act and Section 230 of the Communications Decency Act in the US and the Digital Services Act in Europe, to protect against liability for various linking, caching, ranking, recommending, and hosting activities.
They can use their experience and resources in ways that could affect our competitive position, including by making acquisitions and entering into other strategic arrangements; continuing to invest heavily in technical infrastructure, R&D, and in talent; initiating intellectual property and competition claims (whether or not meritorious); and continuing to compete for users, advertisers, customers, and content providers.
They can use their experience and resources in ways that could affect our competitive position, including by making acquisitions and entering into other strategic arrangements; continuing to invest heavily in technical infrastructure, research and development, and in talent; initiating intellectual property and competition claims (whether or not meritorious); and continuing to compete for users, advertisers, customers, and content providers.
Our business could be negatively affected if we are not able to engage these companies with the necessary capabilities or capacity on reasonable terms, or if those we engage fail to meet their obligations (whether due to financial difficulties or other reasons), or make adverse changes in the pricing or other material terms of our arrangements with them. 13.
Our business could be harmed if we are not able to engage these companies with the necessary capabilities or capacity on reasonable terms, or if those we engage fail to meet their obligations (whether due to financial difficulties or other reasons), or make adverse changes in the pricing or other material terms of our arrangements with them.
While we may not determine some of these issues to be material at the time they occur and may remedy them quickly, there is no guarantee that these issues will not ultimately result in significant legal, financial, and reputational harm, including government inquiries, enforcement actions, litigation, and negative publicity.
While we may not determine some of these issues to be material when they occur and may remedy them quickly, there is no guarantee that these issues will not ultimately result in significant legal, financial, and reputational harm, including government inquiries, enforcement actions, litigation, and negative publicity.
We could be subject to changes in tax rates, the adoption of new U.S. or international tax legislation, or exposure to additional tax liabilities. We are subject to a variety of taxes and tax collection obligations in the U.S. and numerous foreign jurisdictions.
We could be subject to changes in tax rates, the adoption of new US or international tax legislation, or exposure to additional tax liabilities. We are subject to a variety of taxes and tax collection obligations in the US and numerous foreign jurisdictions.
In addition, our compensation arrangements, such as our equity award programs, may not always be successful in attracting new employees and retaining and motivating our existing employees. Immigration policy and regulatory changes may also affect our ability to hire, mobilize, or retain some of our global talent.
In addition, our compensation arrangements, such as our equity award programs, may not always be successful in attracting new employees and retaining and motivating our existing employees. Immigration policy and regulatory changes, and uncertainty regarding such policies and regulations, may also affect our ability to hire, mobilize, or retain some of our global talent.
Because we conduct business in currencies other than U.S. dollars but report our financial results in U.S. dollars, we have faced, and will continue to face, exposure to fluctuations in foreign currency exchange rates.
Because we conduct business in currencies other than US dollars but report our financial results in US dollars, we have faced, and will continue to face, exposure to fluctuations in foreign currency exchange rates.
Further, the increased risk of inadvertent disclosure of confidential information or personal data in connection with the utilization of AI technologies may result in stronger regulatory scrutiny, leading to legal and regulatory investigations and enforcement actions that may negatively affect our business, even if unfounded.
Further, the increased risk of inadvertent disclosure of confidential information or personal data in connection with the utilization of AI technologies may result in stronger regulatory scrutiny, leading to legal and regulatory investigations and enforcement actions that could harm our business, even if unfounded.
Table of Contents Alphabet Inc. Further, we are subject to evolving laws and regulations that dictate whether, how, and under what circumstances we can transfer, process and/or receive personal data, as well as ongoing enforcement actions from supervisory authorities related to cross-border transfers of personal data.
Further, we are subject to evolving laws and regulations that dictate whether, how, and under what circumstances we can transfer, process, or receive personal data, as well as ongoing enforcement actions from supervisory authorities related to cross-border transfers of personal data.
These regulations could result in our having to modify our products and services and incur additional costs to operate and monitor minors’ experiences on our products and services. • Consumer protection: Consumer protection laws, including the EU’s New Deal for Consumers, which could result in monetary penalties and create a range of new compliance obligations.
These regulations could result in our having to modify our products and services and monitor minors' experiences on our products and services. • Consumer protection: Consumer protection laws, including the EU's New Deal for Consumers, which could result in monetary penalties and create a range of new compliance obligations.
Violations of law or unethical business practices could result in supply chain disruptions, canceled orders, harm to key relationships, and damage to our reputation. Their failure to procure necessary license rights to intellectual property could affect our ability to sell our products or services and expose us to litigation or financial claims.
Violations of law or unethical business practices could result in supply chain disruptions, canceled orders, harm to key relationships, and damage to our reputation. Their failure to procure necessary license rights to intellectual property could affect our ability to sell our products or services and expose us to litigation or financial claims. 12. Table of Contents Alphabet Inc.
These endeavors involve significant risks and uncertainties, including diversion of resources and management attention from current operations, different monetization models, and the use of alternative investment, governance, or compensation structures that may fail to adequately align incentives across the company or otherwise accomplish their objectives.
These endeavors involve significant risks and uncertainties, including diversion of resources and management attention from current operations, different monetization models, and the use of alternative investment, governance, or compensation structures that may fail to adequately align incentives across the company or otherwise accomplish their objectives. 9. Table of Contents Alphabet Inc.
All gains and losses on non-marketable equity securities are recognized in OI&E, which increases the volatility of our OI&E. The unrealized gains and losses or impairments we record from fair value remeasurements in any particular period may differ significantly from the gains and losses we ultimately realize on such investments.
Gains and losses on non-marketable equity securities are recognized in other income (expense), net (OI&E), which increases the volatility of our OI&E. The unrealized gains and losses or impairments we record from fair value remeasurements in any particular period may differ significantly from the gains and losses we ultimately realize on such investments.
Adverse macroeconomic conditions have affected, and may in the future affect, the demand for advertising, resulting in fluctuations in the amounts our advertisers spend on advertising, which could harm our financial condition and operating results. We face intense competition.
Adverse macroeconomic conditions have affected, and may in the future affect, the demand for advertising, resulting in fluctuations in the amounts our advertisers spend on advertising, which could harm our financial condition and operating results.
Our ongoing investment in new businesses, products, services, and technologies is inherently risky, and could divert management attention and harm our business, financial condition, and operating results. We have invested and expect to continue to invest in new businesses, products, services, and technologies in a wide range of industries beyond online advertising.
Our increasing investment in new businesses, products, services, and technologies is inherently risky, and could divert management attention and harm our business, financial condition, and operating results. We have invested and expect to expand our investment in new businesses, products, services, and technologies in a wide range of industries beyond online advertising.
Any of these incidents could impede or prevent us from effectively offering products and providing services, which could harm our business, reputation, financial condition, and operating results. Our international operations expose us to additional risks that could harm our business, reputation, financial condition, and operating results. 14. Table of Contents Alphabet Inc.
Any of these incidents could impede or prevent us from effectively offering products and providing services, which could harm our business, reputation, financial condition, and operating results. Our international operations expose us to additional risks that could harm our business, reputation, financial condition, and operating results.
Further, we are subject to evolving laws, regulations, policies, and international accords relating to matters beyond our core products and services, including environmental sustainability, climate change, human capital, and employment matters. In response, we have implemented robust programs, adopted reporting frameworks and principles, and announced a number of complex and ambitious goals and initiatives that may require considerable investments.
Further, we are subject to evolving laws, regulations, policies, and international accords relating to matters beyond our core products and services, including environmental sustainability, climate change, human capital, and employment matters. In response, we have implemented robust programs and initiatives and adopted reporting frameworks and principles that may require considerable investments.
We have invested significantly and expect to continue to invest significantly in our property and equipment, including our technical infrastructure, and we expect these assets to benefit our business over their estimated useful lives.
We have invested and expect to significantly expand our investment in property and equipment, including our technical infrastructure, and we expect these assets to benefit our business over their estimated useful lives.
Such customers and partners may also discontinue the use of our products, services, and technologies, as a result of injunctions or otherwise, which could result in loss of revenues and harm our business.
Such customers and partners may also discontinue the use of our products, services, and technologies, as a result of injunctions or otherwise, which could 20. Table of Contents Alphabet Inc. result in loss of revenues and harm our business.
Examples include laws and regulations regarding: • Competition and technology platforms’ business practices: Laws and regulations focused on large technology platforms, including the Digital Markets Act in the European Union (EU); regulations and legal settlements in the U.S., South Korea, and elsewhere that affect Google Play’s billing policies, fees, and business model; as well as litigation and new and expected regulations in a range of jurisdictions, including, among others, in the UK, Japan, and India. • AI: Laws and regulations focused on the development, use, and provision of AI technologies and other digital products and services, which could result in monetary penalties or other regulatory actions.
Examples include laws and regulations regarding: • Competition and technology platforms' business practices: Laws and regulations focused on large technology platforms, including the Digital Markets Act in the European Union (EU) and the Act on Promotion of Competition for Specified Smartphone Software in Japan; regulations and legal settlements in the US, South Korea, and elsewhere that affect Google Play's billing policies, fees, and business model; as well as litigation and new and expected regulations in a range of jurisdictions. • AI: Laws and regulations focused on the development, use, and provision of AI technologies and other digital products and services, which could result in monetary penalties or other regulatory actions.
For example, there is a risk that the word “Google” could become so commonly used that it becomes synonymous with the word “search.” Some courts have ruled that "Google" is a protectable trademark, but it is possible that other courts, particularly those outside of the U.S., may reach a different determination.
For example, there is a risk that the word "Google" could become so commonly used that it becomes synonymous with the word "search." Some courts have ruled that "Google" is a protectable trademark, but it is possible that other courts, particularly those outside of the US, may reach a different determination.
Any of the foregoing developments may negatively affect user trust and engagement, harm our reputation and brands, require us to change our business practices in ways that harm our business operations, and adversely affect our business and financial results.
Any of the foregoing developments may negatively affect user trust and engagement, harm our reputation and brands, require us to change our business practices in ways that harm our business operations, and adversely affect our business and financial results. Any such developments may also subject us to additional litigation and 16.
In addition, new and evolving products and services, including those that use AI, raise ethical, technological, legal, regulatory, and other challenges, which may negatively affect our brands and demand for our products and services.
In addition, new and evolving products and services, including those that use AI, raise ethical, technological, legal, regulatory, and other challenges, which could harm our brands and demand for our products and services.
The costs of compliance with these measures are high and are likely to increase in the future, including as a result of differing, and sometimes conflicting, laws and regulations. 18. Table of Contents Alphabet Inc.
The costs of compliance with these measures are high and are likely to increase in the future, including as a result of differing, and sometimes conflicting, laws and regulations.
As we continue to expand our business, the number of intellectual property claims against us has increased and may continue to increase as we develop and acquire new products, services, and technologies, including AI technologies.
As we continue to expand our business, intellectual property claims against us have increased and may continue to increase as we develop and acquire new products, services, and technologies, including AI technologies.
Our efforts to prevent security incidents and address undesirable activity on our platform may require us to spend additional resources to prepare and defend against such threats, and could also increase the risk of retaliatory attack. In addition, 16. Table of Contents Alphabet Inc. we face the risk of cyber attacks by nation-states and state-sponsored actors.
Our efforts to prevent security incidents and address undesirable activity on our platform may require us to spend additional resources to prepare and defend against such threats, and could also increase the risk of retaliatory attack. In addition, we face the risk of cyber attacks and data exfiltration or compromise by nation-states and state-sponsored actors.
Increased use of AI in our offerings and internal systems may create new avenues of abuse for bad actors. Many websites violate or attempt to violate our guidelines, including by seeking to inappropriately rank higher in search results than our search engine's assessment of their relevance and utility would rank them.
Increased use of AI in our offerings and internal systems may create new instances of problematic content and increased potential for misuse and abuse. Many websites violate or attempt to violate our guidelines, including by seeking to inappropriately rank higher in search results than our search engine's assessment of their relevance and utility would rank them.
Our ability to deploy certain AI technologies critical for our products and services and for our business strategy may depend on the availability and pricing of third-party equipment and other technical infrastructure operations costs, including network capacity, energy, and equipment costs.
Our ability to deploy certain AI technologies critical for our products and services and for our business strategy may depend on the availability and pricing of third-party equipment and other technical infrastructure operations costs, including network capacity, energy, and equipment costs. Additionally, other companies may develop 10. Table of Contents Alphabet Inc.
Risks Specific to our Company We generate a significant portion of our revenues from advertising. Reduced spending by advertisers, a loss of partners, or new and existing technologies that block ads online and/or affect our ability to personalize ads could harm our business. We generated more than 75% of total revenues from online advertising in 2024.
Risks Specific to our Company We generate a significant portion of our revenues from advertising. Reduced spending by advertisers, a loss of partners, shifts in online advertising, new and evolving advertising formats, or new or existing technologies that block ads online or affect our ability to personalize ads could harm our business.
While we invest significantly in efforts to promote high-quality and relevant results and to detect and prevent low-quality content and invalid traffic, we have been unable and may continue to be unable to detect and prevent all such abuses or promote uniformly high-quality content.
Table of Contents Alphabet Inc. significantly in efforts to promote high-quality and relevant results and to detect and prevent low-quality content and invalid traffic, we have been unable and may continue to be unable to detect and prevent all such abuses or promote uniformly high-quality content.
Our brands have been, and may in the future be, negatively affected by a number of factors, including, among others, reputational issues, third-party content shared on our platforms, data privacy and security issues and developments, and product or technical performance failures.
Our brands have been, and may in the future be, harmed by a number of factors, including, among others, reputational issues, third-party content shared on our platforms, data privacy and security issues and developments, issues in delivering age-appropriate experiences to minors, and product or technical performance failures.
We measure certain of our non-marketable equity and debt securities, certain other instruments including stock-based compensation awards settled in the stock of Other Bet companies, and certain assets and liabilities acquired in a business combination, at fair value on a nonrecurring basis, which is inherently subjective and requires management judgment and estimation.
We measure certain of our non-marketable equity and debt securities, and certain other instruments including stock-based compensation (SBC) awards of Other Bet companies, at fair value on a nonrecurring basis, which is inherently subjective and requires management judgment and estimation.
Table of Contents Alphabet Inc. implementation of AI in our offerings and internal systems) could subject us to regulatory action and legal liability, including under specific legislation regulating AI, as well as new applications of existing data protection, cybersecurity, privacy, intellectual property, and other laws.
Our development, use, and commercialization of AI products and services (including our implementation of AI in our offerings and internal systems) could subject us to regulatory action and legal liability, including under specific legislation regulating AI, as well as new applications of existing data protection, cybersecurity, privacy, intellectual property, and other laws.
We face a number of risks related to manufacturing and supply chain management, which could affect our ability to supply both our products and our services. We rely on contract manufacturers to manufacture or assemble our devices as well as servers and networking equipment used in our technical infrastructure, certain components of which we may supply.
We face a number of manufacturing and supply chain risks that could affect our ability to supply our products and services and harm our business, financial condition, and operating results. We rely on contract manufacturers to manufacture or assemble our devices as well as servers and networking equipment used in our technical infrastructure, certain components of which we may supply.
The secrecy of such trade secrets and other sensitive information could be compromised, which could cause us to lose the competitive advantage resulting from these trade secrets. We also face risks associated with our trademarks.
We also seek to maintain certain intellectual property as trade secrets. The confidentiality of such trade secrets and other sensitive information could be compromised, which could cause us to lose the competitive advantage resulting from these trade secrets. We also face risks associated with our trademarks.
Estimating liabilities for our pending proceedings is a complex, fact-specific, and speculative process that requires significant judgment, and the amounts we are ultimately liable for may be less than or exceed our estimates.
Estimating liabilities for our pending proceedings is a complex, fact-specific, and speculative process that requires significant judgment, and the amounts we are ultimately liable for may differ from our estimates.
In addition to risks described elsewhere in this section, our international operations expose us to other risks, including the following: • restrictions on foreign ownership and investments, and stringent foreign exchange controls that might prevent us from repatriating cash earned in countries outside the U.S.; • sanctions, import and export controls, other market access barriers, political unrest, geopolitical tensions, changes in regimes, or armed conflict (such as ongoing conflicts in the Middle East and Ukraine), any of which may affect our business continuity, increase our operating costs, limit demand for our products and services, limit our ability to source components or final products, or prevent or impede us from operating in certain jurisdictions, complying with local laws, or offering products or services; • longer payment cycles in some countries, increased credit risk, and higher levels of payment fraud; • an evolving foreign policy landscape that could harm our revenues and could subject us to litigation, new regulatory costs and challenges (including new customer requirements), uncertainty regarding regulatory outcomes, and other liabilities under local laws that may not offer due process or clear legal precedent; • anti-corruption laws, such as the U.S.
In addition to risks described elsewhere in this section, our international operations expose us to other risks, including: • restrictions on foreign ownership and investments, and stringent foreign exchange controls that might prevent us from repatriating cash earned in countries outside the US; • sanctions, tariffs, import and export controls, other market access barriers, political unrest, geopolitical tensions, changes in regimes, or armed conflict (such as ongoing conflicts in the Middle East and Ukraine), any of which may affect our business continuity, increase our operating costs, limit demand for our products and services, limit our ability to source components or final products, or prevent or impede us from operating in certain jurisdictions, complying with local laws, or offering products or services; • longer payment cycles in some countries, increased credit risk, and higher levels of payment fraud; • an evolving foreign policy landscape that could harm our revenues and could subject us to litigation, new regulatory costs and challenges (including new customer requirements), uncertainty regarding regulatory outcomes, and other liabilities under local laws that may not offer due process or clear legal precedent; • anti-corruption laws, such as the US Foreign Corrupt Practices Act, and other local laws prohibiting certain payments to government officials, violations of which could result in civil and criminal penalties; and • different employee/employer relationships; different labor laws, regulations, and labor practices; and other challenges caused by distance, language, local expertise, and cultural differences, increasing the complexity of doing business in multiple jurisdictions.
Any and all future cash dividends are subject to declaration by our Board of Directors in its sole discretion, and in accordance with the requirements of any applicable laws, rules, and regulations, including the Delaware General Corporation Law.
Our cash dividend program pays regular cash dividends to our Class A, Class B, and Class C stockholders. Any and all future cash dividends are subject to declaration by our Board of Directors in its sole discretion, and in accordance with the requirements of any applicable laws, rules, and regulations, including the Delaware General Corporation Law.
We also face other challenges from low-quality and irrelevant content websites, including content farms, which are websites that generate large quantities of low-quality content to help them improve their search rankings. We are continually launching algorithmic changes designed to detect and prevent abuse from low-quality websites, but we may not always be successful.
We also face other challenges to the quality of our search results from low-quality and irrelevant content websites, including content farms, which are websites that generate large quantities of low-quality content in an effort to improve their search rankings. We are continually launching algorithmic changes designed to detect and prevent these efforts, but we may not always be successful.
Our products and services may be less popular on some interfaces. Each manufacturer or distributor may establish unique technical standards for its devices, and our products and services may not be available or may only be available with limited functionality for our users or our advertisers on these devices as a result.
Each manufacturer or distributor may establish unique technical standards for its devices, and our products and services may not be available or may only be available with limited functionality for our users or our advertisers on these devices as a result. Some manufacturers may also elect not to include our products on their devices.
International Trade Commission (ITC) for exclusion and cease-and-desist orders. In addition, patent-holding companies may frequently seek to generate income from patents they have obtained by bringing claims against us.
Parties have also sought broad injunctive relief against us by filing claims in US and international courts and the US International Trade Commission (ITC) for exclusion and cease-and-desist orders. In addition, patent-holding companies may frequently seek to generate income from patents they have obtained by bringing claims against us.
The EU AI Act introduces various requirements for AI systems and models placed on the market or put into service in the EU, including specific transparency and other requirements for general purpose AI systems and the models on which those systems are based.
The EU AI Act introduces various requirements for AI systems and models placed on the market in the EU, including specific transparency, safety, and copyright requirements for general purpose AI systems and the models on which those systems are based.
If the quality of our products and services does not meet expectations or our products or services are defective or require a recall, it could harm our business, reputation, financial condition, and operating results.
If the quality of our products and services does not meet expectations, we lack the capacity to deliver them, or our products or services are defective or require a corrective action or recall, it could harm our business, reputation, financial condition, and operating results.
Our international operations are significant to our revenues and net income, and we plan to continue to grow internationally. International revenues accounted for approximately 51% of our consolidated revenues in 2024.
Our international operations are significant to our revenues and net income, and we plan to continue growing internationally. International revenues accounted for approximately 52% of consolidated revenues in 2025.
Our businesses face changing technologies, shifting user needs, and frequent introductions of rival products and services. To compete successfully, we must accurately anticipate technology developments and deliver innovative, relevant and useful products, services, and technologies in a timely manner. As our businesses evolve, the competitive pressure to innovate will encompass a wider range of products and services.
Our businesses face changing technologies, shifting user needs, and frequent introductions of rival products and services. To compete successfully, we must accurately anticipate technology developments and deliver innovative, relevant, and useful products, services, and technologies in a timely manner.
Table of Contents Alphabet Inc. defamation, negligence, breaches of contract, patent, copyright and trademark infringement, unfair competition, unlawful activity, torts, privacy rights violations, fraud, or other legal theories based on the nature and content of information available on or via our services, the design and effect of our products and services, or due to our involvement in hosting, transmitting, marketing, branding, or providing access to content created by third parties.
Claims have been brought, and we expect will continue to be brought, against us for defamation, negligence, breaches of contract, patent, copyright, and trademark infringement, unfair competition, unlawful activity, torts, privacy rights violations, fraud, or other legal theories based on the nature and content of information available on or via our services, the design and effect of our products and services, or due to our involvement in hosting, transmitting, marketing, branding, or providing access to content created by third parties.
Legislation or court rulings affecting these safe harbors may harm us and may impose significant operational challenges. There are legislative proposals and pending litigation in the U.S., EU, and around the world that could diminish or eliminate safe harbor protection for websites and online platforms. Our development, use, and commercialization of AI products and services (including our 19.
Legislation or court rulings affecting these safe harbors may harm us and may impose significant operational challenges. There are legislative proposals and pending litigation in the US, EU, and around the world that could diminish or eliminate safe harbor protection for websites and online platforms.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeITEM 1C. CYBERSECURITY We maintain a comprehensive process for identifying, assessing, and managing material risks from cybersecurity threats as part of our broader risk management system and processes. For example, some risks include our software supply chain and other third-party dependencies, vulnerabilities in our products and services, theft of our intellectual property, and attempts to compromise our infrastructure.
Biggest changeFor example, some risks include our software supply chain and other third-party dependencies, vulnerabilities in our products and services, theft of our intellectual property, and attempts to compromise our infrastructure. We obtain input, as appropriate, for our cybersecurity risk management program on the security industry and threat trends from multiple external experts and internal threat intelligence teams.
As part of our cybersecurity risk management system, our incident management teams track and log privacy and security incidents across Alphabet, our vendors, and other third-party service providers to remediate and resolve any such incidents. Significant incidents are reviewed regularly by a cross-functional working group to determine whether further escalation is appropriate.
As part of our cybersecurity risk management process, our incident management teams track and log privacy and security incidents across Alphabet, our vendors, and other third-party service providers to remediate and resolve any such incidents. Significant incidents are reviewed regularly by a cross-functional working group to determine whether further escalation is appropriate.
The Audit and Compliance Committee has oversight responsibility for risks and incidents relating to cybersecurity threats, including compliance with disclosure requirements, cooperation with law enforcement, and related effects on financial and other risks, and it reports any findings and recommendations, as appropriate, to the full Board for consideration.
The Risk and Compliance Committee has oversight responsibility for risks and incidents relating to cybersecurity threats, including compliance with disclosure requirements, cooperation with law enforcement, and related effects on financial and other risks, and it reports any findings and recommendations, as appropriate, to the full Board for consideration.
Senior management regularly discusses cyber risks and trends and, should they arise, any material incidents with the Audit and Compliance Committee. Internal Audit maintains a dedicated cybersecurity auditing team that independently tests our cybersecurity controls.
Senior management regularly discusses cybersecurity risks and trends and, should they arise, any material incidents with the Risk and Compliance Committee. Internal Audit maintains a dedicated cybersecurity auditing team that independently tests our cybersecurity controls.
These teams comprise professionals with deep cybersecurity expertise across multiple industries and are led by our Vice President of Privacy, Safety, and Security Engineering, who has 20 years of experience, including roles in technology infrastructure for two other large public companies.
These teams comprise professionals with deep cybersecurity expertise across multiple industries and are led by our Vice President of Privacy, Safety, and Security, who has more than 20 years of experience, including roles in technology infrastructure for two other large public companies.
Any incident assessed as potentially being or potentially becoming material is promptly escalated for further assessment, and then reported to designated members of our senior management. We consult with outside counsel as appropriate, including on materiality analysis and disclosure matters, and our senior 25.
Any incident assessed as potentially being or potentially becoming material is promptly escalated for further assessment, and then reported to designated members of our senior management. We consult with outside counsel as appropriate, including on materiality analysis and disclosure matters, and our senior management makes the final materiality determinations and disclosure and other compliance decisions.
Table of Contents Alphabet Inc. management makes the final materiality determinations and disclosure and other compliance decisions. Our management apprises Alphabet’s independent public accounting firm of matters and any relevant developments.
Our management apprises Alphabet’s independent public accounting firm of relevant matters and developments.
We obtain input, as appropriate, for our cybersecurity risk management program on the security industry and threat trends from multiple external experts and internal threat intelligence teams. Teams of dedicated privacy, safety, and security professionals oversee cybersecurity risk management and mitigation, incident prevention, detection, and remediation.
Teams of dedicated privacy, safety, and security professionals oversee cybersecurity risk management and mitigation, incident prevention, detection, and remediation.
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ITEM 1C. CYBERSECURITY 23. Table of Contents Alphabet Inc. We maintain a comprehensive process for identifying, assessing, and managing material risks from cybersecurity threats as part of our broader risk management system and processes.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeIssuer Purchases of Equity Securities The following table presents information with respect to Alphabet's repurchases of Class A and Class C stock during the quarter ended December 31, 2024 : Period Total Number of Class A Shares Purchased (in thousands) (1) Total Number of Class C Shares Purchased (in thousands) (1) Average Price Paid per Class A Share (2) Average Price Paid per Class C Share (2) Total Number of Shares Purchased as Part of Publicly Announced Programs (in thousands) (1) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (in millions) October 1 - 31 5,792 30,080 $ 167.66 $ 168.84 35,872 $ 53,699 November 1 - 30 4,325 22,450 $ 174.97 $ 175.98 26,775 $ 49,023 December 1 - 31 3,559 19,572 $ 187.07 $ 187.52 23,131 $ 44,704 Total 13,676 72,102 85,778 (1) R epurchases are being executed from time to time, subject to general business and market conditions and other investment opportunities, through open market purchases or privately negotiated transactions, including through Rule 10b5-1 plans.
Biggest changeIssuer Purchases of Equity Securities The following table presents information with respect to Alphabet's repurchases of Class A and Class C stock during the quarter ended December 31, 2025 : Period Total Number of Class A Shares Purchased (in thousands) (1) Total Number of Class C Shares Purchased (in thousands) (1) Average Price Paid per Class A Share (2) Average Price Paid per Class C Share (2) Total Number of Shares Purchased as Part of Publicly Announced Programs (in thousands) (1) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (in millions) October 1 - 31 841 13,305 $ 253.20 $ 255.03 14,146 $ 71,231 November 1 - 30 209 5,885 $ 286.00 $ 281.46 6,094 $ 69,503 December 1 - 31 0 0 $ 0.00 $ 0.00 0 $ 69,503 Total 1,050 19,190 20,240 (1) In April 2024, the company's Board of Directors authorized a $70.0 billion share repurchase program for its Class A and Class C shares.
Because many of our shares of Class A stock and Class C stock are held by brokers and other institutions on behalf of stockholders, we are unable to estimate the total number of stockholders represented by these record holders. As of December 31, 2024, there were approximately 57 st ockholders of record of our Class B stock.
Because many of our shares of Class A stock and Class C stock are held by brokers and other institutions on behalf of stockholders, we are unable to estimate the total number of stockholders represented by these record holders. As of December 31, 2025, there were approximately 57 st ockholders of record of our Class B stock.
The graph tracks the performance of a $100 investment in our Class C capital stock and in each index (with the reinvestment of all dividends) from December 31, 2019, to December 31, 2024. The returns shown are based on historical results and are not intended to suggest future performance. COMPARISON OF CUMULATIVE 5-YEAR TOTAL RETURN* ALPHABET INC.
The graph tracks the performance of a $100 investment in our Class C capital stock and in each index (with the reinvestment of all dividends) from December 31, 2020, to December 31, 2025. The returns shown are based on historical results and are not intended to suggest future performance. COMPARISON OF CUMULATIVE 5-YEAR TOTAL RETURN* ALPHABET INC.
The graph tracks the performance of a $100 investment in our common stock and in each index (with the reinvestment of all dividends) from December 31, 2019, to December 31, 2024. The returns shown are based on historical results and are not intended to suggest future performance. COMPARISON OF CUMULATIVE 5-YEAR TOTAL RETURN* ALPHABET INC.
The graph tracks the performance of a $100 investment in our common stock and in each index (with the reinvestment of all dividends) from December 31, 2020, to December 31, 2025. The returns shown are based on historical results and are not intended to suggest future performance. COMPARISON OF CUMULATIVE 5-YEAR TOTAL RETURN* ALPHABET INC.
CLASS C CAPITAL STOCK Among Alphabet Inc., the S&P 500 Index, the NASDAQ Composite Index, and the RDG Internet Composite Index *$100 invested on December 31, 2019, in stock or in index, including reinvestment of dividends. Copyright © 2025 S&P, a division of The McGraw-Hill Companies Inc. All rights reserved.
CLASS C CAPITAL STOCK Among Alphabet Inc., the S&P 500 Index, the NASDAQ Composite Index, and the RDG Internet Composite Index *$100 invested on December 31, 2020, in stock or in index, including reinvestment of dividends. Copyright © 2026 S&P, a division of The McGraw-Hill Companies Inc. All rights reserved.
The repurchase program does not have an expiration date. For additional information related to share repurchases, see Note 11 o f the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. (2) Average price paid per share includes costs associated with the repurchases. 27. Table of Contents Alphabet Inc.
The repurchase programs do not have an expiration date. For additional information related to share repurchases, see Note 11 o f the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. (2) Average price paid per share includes costs associated with the repurchases. 25. Table of Contents Alphabet Inc.
CLASS A COMMON STOCK Among Alphabet Inc., the S&P 500 Index, the NASDAQ Composite Index, and the RDG Internet Composite Index *$100 invested on December 31, 2019, in stock or index, including reinvestment of dividends. Copyright © 2025 S&P, a division of The McGraw-Hill Companies Inc. All rights reserved. 28. Table of Contents Alphabet Inc.
CLASS A COMMON STOCK Among Alphabet Inc., the S&P 500 Index, the NASDAQ Composite Index, and the RDG Internet Composite Index *$100 invested on December 31, 2020, in stock or index, including reinvestment of dividends. Copyright © 2026 S&P, a division of The McGraw-Hill Companies Inc. All rights reserved. 26. Table of Contents Alphabet Inc.
Dividend Program Dividend payments to stockholders of Class A, Class B, and Class C shares were $3.5 billion, $519 million, and $3.3 billion , respectively, for the year ended December 31, 2024. The company intends to pay quarterly cash dividends in the future, subject to review and approval by the company’s Board of Directors in its sole discretion.
Dividend Program Dividend payments to stockholders of Class A, Class B, and Class C shares were $4.8 billion, $703 million, and $4.5 billion, respectively, for the year ended December 31, 2025. The company intends to pay quarterly cash dividends in the future, subject to review and approval by the company’s Board of Directors in its sole discretion.
Our Class C stock has been listed on the Nasdaq Global Select Market under the symbol “GOOG” since April 3, 2014. Holders of Record As of December 31, 2024 , there were approxim ately 7,743 and 1,671 stockholders of record of our Class A stock and Class C stock, respectively.
Our Class C stock has been listed on the Nasdaq Global Select Market under the symbol “GOOG” since April 3, 2014. Holders of Record As of December 31, 2025 , there were approxim a tely 5,861 and 1,611 stock holders of record of our Class A stock and Class C stock, respectively.
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In April 2025, the company's Board of Directors authorized an additional $70.0 billion share repurchase program for its Class A and Class C shares. Repurchases are being executed from time to time, subject to general business and market conditions and other investment opportunities, through open market purchases or privately negotiated transactions, including through Rule 10b5-1 plans.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest change(2) For additional information on the calculation of diluted EPS, see Note 12 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. • Revenues were $350.0 billion, an increase of 14% year over year, primarily driven by an increase in Google Services revenues of $32.4 billion, or 12%, and an increase in Google Cloud revenues of $10.1 billion, or 31%. • Total constant currency revenues, which exclude the effect of hedging, increased 15% year over year. • Cost of revenues wa s $146.3 billion, an increase of 10% year over year, primarily driven by increases in content acquisition costs, TAC, and depreciation expense. • Operating expenses were $91.3 billion, an increase of 2% year over year, primarily driven by increases in de preciation expense, employee compensation expenses, and third-party services fees.
Biggest changeExecutive Overview The following table summarizes consolidated financial results (in millions, except for per share information and percentages): Year Ended December 31, 2024 2025 $ Change % Change Consolidated revenues $ 350,018 $ 402,836 $ 52,818 15 % Cost of revenues $ 146,306 $ 162,535 $ 16,229 11 % Operating expenses $ 91,322 $ 111,262 $ 19,940 22 % Operating income $ 112,390 $ 129,039 $ 16,649 15 % Operating margin 32 % 32 % 0 % Other income (expense), net $ 7,425 $ 29,787 $ 22,362 301 % Net income $ 100,118 $ 132,170 $ 32,052 32 % Diluted net income per share (1) $ 8.04 $ 10.81 $ 2.77 34 % (1) For additional information on the calculation of diluted net income per share, see Note 12 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. • Revenues were $402.8 billion, an increase of 15% year over year, primarily driven by an increase in Google Services revenues of $37.8 billion, or 12%, and an increase in Google Cloud revenues of $15.5 billion, or 36%. • Cost of revenues was $162.5 billion, an increase of 11% ye ar over year, primarily driven by increases in TAC, content acquisition costs, and depreciation expense. • Operating ex penses were $111.3 billion, an increase of 22% ye ar over year, primarily driven by increases in employee compensation expenses, expenses related to legal and other matters, and depreciation expense.
Revenues and Monetization Metrics We generate revenues by delivering relevant, cost-effective online advertising; cloud-based solutions that provide enterprise customers of all sizes with infrastructure, platform services, and applications; sales of other products and services, such as fees received for subscription-based products, apps and in-app purchases, and devices.
Revenues and Monetization Metrics We generate revenues by delivering relevant, cost-effective online advertising; cloud-based solutions that provide enterprise customers of all sizes with infrastructure, platform services, and applications; and sales of other products and services, such as fees received for subscription-based products, apps and in-app purchases, and devices.
Our distribution partners include browser providers, mobile carriers, original equipment manufacturers, and software developers; and ◦ amounts paid to Google Network partners primarily for ads displayed on their properties. • Other cost of revenues primarily includes: ◦ content acquisition costs, which are payments to content providers from whom we license video and other content for distribution, primarily related to YouTube (we pay fees to these content providers based on revenues generated, subscriber counts, or a flat fee); ◦ depreciation expense related to our technical infrastructure; ◦ employee compensation expenses related to our technical infrastructure and other operations such as content review and customer and product support; ◦ inventory and other costs related to the devices we sell; and ◦ other technical infrastructure operations costs, including network capacity, energy, and equipment costs.
Our distribution partners include browser providers, mobile carriers, original equipment manufacturers, and software developers; and ◦ amounts paid to Google Network partners primarily for ads displayed on their properties. • Other cost of revenues primarily includes: ◦ content acquisition costs, which are payments to content providers from whom we license video and other content for distribution, primarily related to YouTube (we pay fees to these content providers based on revenues generated, subscriber counts, or a flat fee); ◦ depreciation expense, primarily related to our technical infrastructure; ◦ employee compensation expenses related to our technical infrastructure and other operations such as content review and customer and product support; ◦ inventory and other costs related to the devices we sell; and ◦ other technical infrastructure operations costs, including energy, equipment, and network capacity costs.
Google Advertising Google advertising revenues are comprised of the following: • Google Search & other, which includes revenues generated on Google search properties (including revenues from traffic generated by search distribution partners who use Google.com as their default search in browsers, toolbars, etc.), and other Google owned and operated properties like Gmail, Google Maps, and Google Play; • YouTube ads, which includes revenues generated on YouTube properties; and • Google Network, which includes revenues generated on Google Network properties participating in AdMob, AdSense, and Google Ad Manager.
Google Advertising Google advertising revenues are comprised of the following: • Google Search & other, which includes revenues generated on Google search properties (including revenues from traffic generated by search distribution partners who use Google.com as their default search in browsers, toolbars, etc.), and other Google owned and operated properties like Gmail, Google Maps, and Google Play; • YouTube ads, which includes revenues generated on YouTube properties; and • Google Network, which includes revenues generated on Google Network properties participating in AdMob, AdSense, and Google Ad Manager. 29.
These services provide access to solutions such as AI offerings including our AI infrastructure, Vertex AI platform, and Gemini for Google Cloud; cybersecurity; and data and analytics; • Google Workspace, which includes subscriptions for cloud-based communication and collaboration tools for enterprises, such as Calendar, Gmail, Docs, Drive, and Meet, with integrated features like Gemini for Google Workspace; and • other enterprise services.
These services provide access to solutions such as AI offerings including our enterprise AI infrastructure, Vertex AI platform, and Gemini Enterprise; cybersecurity offerings; and data and analytics solutions; • Google Workspace includes subscriptions for cloud-based communication and collaboration tools for enterprises, such as Gmail, Docs, Calendar, Drive, and Meet, with integrated features like Gemini for Google Workspace; and • other enterprise services.
In addition to the long-term trends and their financial effect on our business discussed above, fluctuations in our revenues have been and may continue to be affected by a combination of factors, including: • changes in foreign currency exchange rates; • changes in pricing, such as those resulting from changes in fee structures, discounts, and customer incentives; • general economic conditions and various external dynamics, including geopolitical events, regulations, and other measures and their effect on advertiser, consumer, and enterprise spending; • new product, service, and market launches; and 31.
In addition to the long-term trends and their financial effect on our business discussed above, fluctuations in our revenues have been and may continue to be affected by a combination of factors, including: • changes in foreign currency exchange rates; • changes in pricing, such as those resulting from changes in fee structures, discounts, and customer incentives; • general economic conditions and various external dynamics, including geopolitical events, regulations, and other measures and their effect on advertiser, consumer, and enterprise spending; • new product, service, and market launches; and • seasonality.
We base our estimates on past experience and other assumptions that we believe are reasonable under the circumstances, and we evaluate these estimates on an ongoing basis. We have reviewed our critical accounting estimates with the Audit and Compliance Committee of our Board of Directors.
We base our estimates on past experience and other assumptions that we believe are reasonable under the circumstances, and we evaluate these estimates on an ongoing basis. We have reviewed our critical accounting estimates with the Audit Committee of our Board of Directors.
The following section generally discusses 2024 results compared to 2023 results. Discussion of 2023 results compared to 2022 results to the extent not included in this report can be found in Item 7 of our 2023 Annual Report on Form 10-K. Understanding Alphabet’s Financial Results Alphabet is a collection of businesses — the largest of which is Google.
The following section generally discusses 2025 results compared to 2024 results. Discussion of 2024 results compared to 2023 results to the extent not included in this report can be found in Item 7 of our 2024 Annual Report on Form 10-K. Understanding Alphabet’s Financial Results Alphabet is a collection of businesses — the largest of which is Google.
Net cash provided by operating activities increased from 2023 to 2024 due to an increase in cash received from customers, partially offset by an increase in cash payments for cost of revenues and operating expenses. Cash Used in Investing Activities Cash provided by investing activities consists primarily of maturities and sales of investments in marketable and non-marketable securities.
Net cash provided by operating activities increased from 2024 to 2025 due to an increase in cash received from customers, partially offset by an increase in cash payments for cost of revenues and operating expenses. Cash Used in Investing Activities Cash provided by investing activities consists primarily of maturities and sales of investments in marketable and non-marketable securities.
Other Income (Expense), Net OI&E, net primarily consists of interest income (expense), the effect of foreign currency exchange gains (losses), net gains (losses) and impairment on our marketable and non-marketable securities, performance fees, and income (loss) and impairment from our equity method investments.
Other Income (Expense), Net OI&E, net primarily consists of interest income (expense), the effect of foreign currency exchange gains (losses), net gains (losses) and impairment on our marketable and non-marketable securities and income (loss) and impairment from our equity method investments.
The provision for income taxes includes the effect of reserve provisions and changes to reserves as well as the related net interest and penalties. In addition, we are subject to the continuous examination of our income tax returns by the IRS and other tax authorities which may assert assessments against us.
The provision for income taxes includes the effect of reserve provisions and changes to reserves as well as the related net interest and penalties. In addition, we are subject to the continuous examination of our income tax returns by the Internal Revenue Service (IRS) and other tax authorities which may assert assessments against us.
Provision for Income Taxes Provision for income taxes represents the estimated amount of federal, state, and foreign income taxes incurred in the U.S. and the many jurisdictions in which we operate. The provision includes the effect of reserve provisions and changes to reserves that are considered appropriate as well as the related net interest and penalties.
Provision for Income Taxes Provision for income taxes represents the estimated amount of federal, state, and foreign income taxes incurred in the US and the many jurisdictions in which we operate. The provision includes the effect of reserve provisions and changes to reserves that are considered appropriate as well as the related net interest and penalties.
Cost of Revenues Cost of revenues is comprised of TAC and other costs of revenues. • TAC includes: ◦ amounts paid to our distribution partners who make available our search access points and services.
Cost of Revenues Cost of revenues is comprised of TAC and other costs of revenues. • TAC includes: ◦ amounts paid to our distribution partners who make available our search access points and other ad-supported services.
We evaluate, on a regular basis, developments in our legal matters that could affect the amount of liability that has been previously accrued, and the matters and related reasonably possible losses disclosed, and make adjustments and changes to our disclosures. Significant judgment is required to determine both the likelihood and the estimated amount of a loss related to such matters.
We evaluate, on a regular basis, developments in our legal matters that could affect the amount of liability that has been previously accrued, and the matters and related reasonably possible losses disclosed, and make adjustments as necessary. Significant judgment is required to determine both the likelihood and the estimated amount of a loss related to such matters.
TAC as a percentage of revenues generated from ads placed on Google Network properties are significantly higher than TAC as a percentage of revenues generated from ads placed on Google Search & other properties, because most of the advertiser revenues from ads served on Google Network properties are paid as TAC to our Google Network partners. Operating Expenses 33.
TAC as a percentage of revenues generated from ads placed on Google Network properties are significantly higher than TAC as a percentage of revenues generated from ads placed on Google Search & other properties, because most of the advertiser revenues from ads served on Google Network properties are paid as TAC to our Google Network partners.
The main components of our sales and marketing expenses are: • employee compensation expenses for employees engaged in sales and marketing, sales support, and certain customer service functions; and • spend relating to our advertising and promotional activities in support of our products and services.
The main components of our sales and marketing expenses are: • employee compensation expenses for employees engaged in sales and marketing, sales support, and certain customer service functions; and • spend relating to our advertising and promotional activities in support of our products and services. The main components of our general and administrative expenses are: 31.
Cash Used in Financing Activities Cash provided by financing activities consists primarily of proceeds from issuance of debt and proceeds from the sale of interests in consolidated entities. Cash used in financing activities consists primarily of repurchases of stock, net payments related to stock-based award activities, payment of dividends, and repayments of debt.
Cash Used in Financing Activities Cash provided by financing activities consists primarily of proceeds from issuance of debt and proceeds from the sale of interests in consolidated entities. Cash used in financing activities consists primarily of repurchases of stock, repayments of debt, net payments related to stock-based award activities, and dividend payments.
Google Cloud Google Cloud revenues are comprised of the following: • Google Cloud Platform, which generates consumption-based fees and subscriptions for infrastructure, platform, and other services.
Google Cloud Google Cloud revenues are comprised of the following: • Google Cloud Platform primarily generates consumption-based fees and subscriptions for infrastructure, platform, and other services.
Monetization Metrics The following table presents changes in monetization metrics for Google Search & other revenues (paid clicks and cost-per-click) and Google Network revenues (impressions and cost-per-impression), expressed as a percentage, from 2023 to 2024: Google Search & other Paid clicks change 5 % Cost-per-click change 7 % Google Network Impressions change (11) % Cost-per-impression change 10 % Changes in paid clicks and impressions are driven by a number of interrelated factors, including changes in advertiser spending; ongoing product and policy changes; and, as it relates to paid clicks, fluctuations in search queries resulting from changes in user adoption and usage, primarily on mobile devices.
Monetization Metrics The following table presents changes in monetization metrics for Google Search & other revenues (paid clicks and cost-per-click) and Google Network revenues (impressions and cost-per-impression), expressed as a percentage, from 2024 to 2025: Google Search & other Paid clicks change 6 % Cost-per-click change 7 % Google Network Impressions change (7) % Cost-per-impression change 7 % Changes in paid clicks and impressions are driven by a number of interrelated factors, including changes in advertiser spending; ongoing product and policy changes; and, as it relates to paid clicks, fluctuations in search queries resulting from changes in user adoption and usage, primarily on mobile devices.
Table of Contents Alphabet Inc. Fluctuations in our Google subscriptions, platforms, and devices revenues have been, and may continue to be, affected by factors in addition to the general factors described above, such as changes in customer usage and demand, number of subscribers, and the timing of product launches.
Fluctuations in our Google subscriptions, platforms, and devices revenues have been, and may continue to be, affected by factors in addition to the general factors described above, such as changes in customer usage and demand, number of subscribers, and the timing of product launches.
Assets not yet in service are those that are not ready for our intended use, including assets in the process of construction or assembly, and consists primarily of technical infrastructure. The time frame from date of purchase to placement in service of these assets may extend from months to years.
Assets not yet in service are those that are not ready for their intended use, including assets in the process of construction or assembly, and consist primarily of technical infrastructure. The time frame from date of purchase to placement in service of these assets may extend from months to years.
We use certain metrics to track how well traffic across various properties is monetized as it relates to our advertising revenues: paid clicks and cost-per-click pertain to traffic on Google Search & other properties, while impressions and cost-per-impression pertain to traffic on our Google Network properties.
Table of Contents Alphabet Inc. We use certain metrics to track how well traffic across various properties is monetized as it relates to our advertising revenues: paid clicks and cost-per-click pertain to traffic on Google Search & other properties, while impressions and cost-per-impression pertain to traffic on our Google Network properties.
For example, our data center construction projects are generally multi-year projects with multiple phases, where we acquire land and buildings, construct buildings, and secure and install servers and network equipment. During the years ended December 31, 2023 and 2024, we spent $32.3 billion and $52.5 billion on capital expenditures, respectively.
For example, our data center construction projects are generally multi-year projects with multiple phases, where we acquire land and buildings, construct buildings, and secure and install servers and network equipment. During the years ended December 31, 2024 and 2025, we spent $52.5 billion and $91.4 billion on capital expenditures, respectively.
Segment Profitability We report our segment results as Google Services, Google Cloud, and Other Bets. Additionally, certain costs are not allocated to our segments because they represent Alphabet-level activities.
Table of Contents Alphabet Inc. Segment Profitability We report our segment results as Google Services, Google Cloud, and Other Bets. Additionally, certain costs are not allocated to our segments because they represent Alphabet-level activities.
The increase in TAC from 2023 to 2024 was largely due to an increase in TAC paid to distribution partners, primarily driven by growth in revenues subject to TAC. The TAC rate decreased from 21.4% to 20.7% from 2023 to 2024 primarily due to a revenue mix shift from Google Network properties to Google Search & other properties.
The increase in TAC from 2024 to 2025 was largely due to an increase in TAC paid to distribution partners, primarily driven by growth in revenues subject to TAC. The TAC rate decreased from 20.7% to 20.3% from 2024 to 2025, primarily due to a revenue mix shift from Google Network properties to Google Search & other properties.
Our primary uses of cash from operating activities include payments to distribution and Google Network partners, to employees for compensation, and to content providers. Other uses of cash from operating activities include payments to suppliers for devices, to tax authorities for income taxes, and other general corporate expenditures.
Our primary uses of cash from operating activities include payments to distribution and Google Network partners, to employees for compensation, and to content providers. Other uses of cash from operating activities include payments to suppliers for devices, to tax authorities for income taxes, and other general corporate expenditures. 37. Table of Contents Alphabet Inc.
To the extent that the final tax outcome of these matters is different than the amounts recorded, such 44. Table of Contents Alphabet Inc. differences will affect the provision for income taxes and the effective tax rate in the period in which such determination is made.
To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences will affect the provision for income taxes and the effective tax rate in the period in which such determination is made.
Certain of these arrangements result in a portion of the cash received from and paid to the contract manufacturers to be presented as financing activities in the Consolidated Statements of Cash Flows included in Item 8 of this Annual Report on Form 10-K. Share Repurchase Program During 2024, we repurchased and subsequently retired 379 million shares for $62.0 billion .
Certain of these arrangements result in a portion of the cash received from and paid to contract manufacturers to be presented as financing activities on the Consolidated Statements of Cash Flows included in Item 8 of this Annual Report on Form 10-K. Share Repurchase Program During 2025, we repurchased and subsequently retired 240 million shares for $45.4 billion.
Costs and Expenses Our cost structure has two components: cost of revenues and operating expenses. Our operating expenses include costs related to R&D, sales and marketing, and general and administrative functions.
Costs and Expenses Our cost structure has two components: cost of revenues and operating expenses. Our operating expenses include costs related to research and development, sales and marketing, and general and administrative functions.
Google subscriptions, platforms, and devices Google subscriptions, platforms, and devices revenues are comprised of the following: • consumer subscriptions, which primarily include revenues from YouTube services, such as YouTube TV, YouTube Music and Premium, and NFL Sunday Ticket, as well as Google One; • platforms, which primarily include revenues from Google Play sales of apps and in-app purchases; • devices, which primarily include sales of the Pixel family of devices; and • other products and services. 32.
Google Subscriptions, Platforms, and Devices Google subscriptions, platforms, and devices revenues are comprised of the following: • consumer subscriptions, which primarily include revenues from YouTube services, such as YouTube TV, YouTube Music and Premium, and NFL Sunday Ticket, as well as Google One, which offers access to our most capable Gemini models; • platforms, which primarily include revenues from Google Play sales of apps and in-app purchases; • devices, which primarily include sales of the Pixel family of devices; and • other products and services.
Table of Contents Alphabet Inc. • seasonality. Additionally, fluctuations in our revenues generated from advertising ("Google advertising"), other sources ("Google subscriptions, platforms, and devices"), Google Cloud, and Other Bets have been, and may continue to be, affected by other factors unique to each set of revenues, as described below.
Additionally, fluctuations in our revenues generated from advertising ("Google advertising"), other sources ("Google subscriptions, platforms, and devices"), Google Cloud, and Other Bets have been, and may continue to be, affected by other factors unique to each set of revenues, as described below. Google Services Google Services revenues consist of Google advertising as well as Google subscriptions, platforms, and devices revenues.
For additional information, including a reconciliation of the U.S. federal statutory rate to our effective tax rate, see Note 14 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. 34. Table of Contents Alphabet Inc.
For additional information, including a reconciliation of the US federal statutory rate to our effective tax rate, see Note 14 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.
Additionally, fluctuations in employee compensation expenses may not directly correlate with changes in headcount, due to factors such as annual stock-based compensation (SBC) awards that generally vest over four years.
Additionally, fluctuations in employee compensation expenses may not directly correlate with changes in headcount, due to factors such as annual SBC awards that vest over time.
The overall growth was driven by interrelated factors including increases in search queries resulting from growth in user adoption and usage on mobile devices; growth in advertiser spending; and improvements we have made in ad formats and delivery. YouTube ads YouTube ads revenues increased $4.6 billion from 2023 to 2024.
The overall growth was driven by interrelated factors including increases in search queries resulting from growth in user adoption and usage on mobile devices; growth in advertiser spending; and improvements we have made in ad formats and delivery. 33. Table of Contents Alphabet Inc. YouTube ads YouTube ads revenues increased $4.2 billion from 2024 to 2025.
The OECD is coordinating negotiations among more than 140 countries with the goal of achieving consensus around substantial changes to international tax policies, including the implementation of a minimum global effective tax rate of 15%.
The OECD is coordinating negotiations among more than 140 countries with the goal of achieving consensus around substantial changes to international tax policies, including the implementation of a minimum global effective tax rate of 15%. Some countries have already implemented the legislation effective January 1, 2024.
Income Taxes We are subject to income taxes in the U.S. and foreign jurisdictions. Significant judgment is required in evaluating our uncertain tax positions and determining our provision for income taxes. Recording an uncertain tax position involves various qualitative considerations, including evaluation of comparable and resolved tax exposures, applicability of tax laws, and likelihood of settlement.
Significant judgment is required in evaluating our uncertain tax positions and determining our provision for income taxes. Recording an uncertain tax position involves various qualitative considerations, including evaluation of comparable and resolved tax exposures, applicability of tax laws, and likelihood of settlement.
Fluctuations in our Google Cloud revenues have been, and may continue to be, affected by factors in addition to the general factors described above, such as changes in customer usage and demand. Other Bets Revenues from Other Bets are generated primarily from the sale of healthcare-related services, and internet services.
Fluctuations in our Google Cloud revenues have been, and may continue to be, affected by factors in addition to the general factors described above, such as changes in customer usage, demand, and supply availability. 30. Table of Contents Alphabet Inc. Other Bets Revenues from Other Bets are generated primarily from the sale of autonomous transportation services and internet services.
The main components of our general and administrative expenses are: • employee compensation expenses for employees in finance, human resources, information technology, legal, and other administrative support functions; • expenses relating to legal and other matters, including certain fines and settlements; and • third-party services fees, including audit, consulting, outside legal, and other outsourced administrative services.
Table of Contents Alphabet Inc. • employee compensation expenses for employees in finance, human resources, information technology, legal, and other administrative support functions; • expenses relating to legal and other matters, including certain fines and settlements; and • third-party services fees, including audit, consulting, outside legal, and other outsourced administrative services.
Net cash used in investing activities increased from 2023 to 2024 primarily due to an increase in purchases of property and equipment and purchases of marketable securities, partially offset by increases in maturities and sales of marketable securities. The increase in purchases of property and equipment is primarily driven by investments in technical infrastructure.
Net cash used in investing activities increased from 2024 to 2025, primarily due to an increase in purchases of property and equipment, driven by investments in technical infrastructure, and a decrease in maturities and sales of marketable securities.
For additional information, see Part I, Item 1A Risk Factors and Legal Matters in Note 10 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. • Our employees are critical to our success and we expect to continue investing in them.
For additional information, see Part I, Item 1A Risk Factors and Legal Matters in Note 10 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.
The following table presents our cash flows (in millions): Year Ended December 31, 2023 2024 Net cash provided by operating activities $ 101,746 $ 125,299 Net cash used in investing activities $ (27,063) $ (45,536) Net cash used in financing activities $ (72,093) $ (79,733) Cash Provided by Operating Activities Our largest source of cash provided by operations are advertising revenues generated by Google Search & other properties, Google Network properties, and YouTube properties.
The following table presents cash flows (in millions): Year Ended December 31, 2024 2025 Net cash provided by operating activities $ 125,299 $ 164,713 Net cash used in investing activities $ (45,536) $ (120,291) Net cash used in financing activities $ (79,733) $ (37,388) Cash Provided by Operating Activities Our largest source of cash provided by operations are advertising revenues generated by Google Search & other properties, YouTube properties, and Google Network properties.
Table of Contents Alphabet Inc. Operating expenses are generally incurred during our normal course of business, which we categorize as either R&D, sales and marketing, or general and administrative.
Operating Expenses Operating expenses are generally incurred during our normal course of business, which we categorize as either research and development, sales and marketing, or general and administrative.
These investments are accounted for under the measurement alternative method ("the measurement alternative") and are measured at cost, less impairment, subject to upward and downward adjustments resulting from observable price changes for identical or similar investments of the same issuer. These adjustments require quantitative assessments of the fair value of our securities, which may require the use of unobservable inputs.
These investments are accounted for under the measurement alternative method ("the measurement alternative") and are measured at cost, less impairment, subject to upward and downward adjustments resulting from observable price changes for identical or similar investments of the same issuer.
The main components of our R&D expenses are: • depreciation; • employee compensation expenses for engineering and technical employees responsible for R&D related to our existing and new products and services; and • third-party services fees primarily relating to consulting and outsourced services in support of our engineering and product development efforts.
The main components of our research and development expenses are: • depreciation expense, primarily related to our technical infrastructure; • employee compensation expenses for engineering and technical employees responsible for research and development related to our existing and new products and services; • other technical infrastructure operations costs, including energy, equipment, and network capacity costs; and • third-party services fees primarily relating to consulting and outsourced services in support of our engineering and product development efforts.
For additional information, see Note 11 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.
For additional information, see Note 3 and Note 7 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. 36. Table of Contents Alphabet Inc.
The growth was driven by our brand advertising products followed by our direct response advertising products, both of which benefited from increased spending by our advertisers. Google Network Google Network revenues decreased $953 million from 2023 to 2024, primarily driven by a decrease in Google Ad Manager and AdMob revenues.
The growth was driven by our direct response advertising products followed by our brand advertising products, both of which benefited from increased spending by our advertisers. Google Network Google Network revenues decreased $567 million from 2024 to 2025, primarily due to a decrease in AdSense revenues, partially offset by an increase in AdMob revenues.
We report Google in two segments, Google Services and Google Cloud; we also report all non-Google businesses collectively as Other Bets. For further details on our segments, see Part I, Item 1 Business and Note 15 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.
For further details on our segments, see Part I, Item 1 Business and Note 15 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.
The increase in operating income was primarily driven by an increase in revenues, partially offset by increases in usage costs for technical infrastructure as well as employee compensation expenses, largely driven by headcount growth. Other Bets Other Bets operating loss increased $349 million from 2023 to 2024.
The increase in operating income was primarily driven by an increase in revenues, partially offset by increases in usage costs for technical infrastructure and employee compensation expenses. Other Bets Other Bets operating loss increased $3.1 billion from 2024 to 2025.
Provision for Income Taxes The following table presents provision for income taxes (in millions, except effective tax rate): Year Ended December 31, 2023 2024 Income before provision for income taxes $ 85,717 $ 119,815 Provision for income taxes $ 11,922 $ 19,697 Effective tax rate 13.9 % 16.4 % The effective tax rate increased from 2023 to 2024.
Provision for Income Taxes The following table presents provision for income taxes (in millions, except effective tax rate): Year Ended December 31, 2024 2025 Income before provision for income taxes $ 119,815 $ 158,826 Provision for income taxes $ 19,697 $ 26,656 Effective tax rate 16.4 % 16.8 % The effective tax rate increased from 2024 to 2025.
We continue to make significant research and development investments in areas of strategic focus as we seek to develop new, innovative offerings, improve our existing offerings, and rapidly and responsibly deploy AI across our businesse s.
Continued Investment in Intellectual Property through R&D and Acquisitions: We continue to make significant research and development investments in areas of strategic focus as we seek to develop new, innovative offerings, and improve our existing offerings across our businesse s.
Capital Expenditures Our capital investments in property and equipment consist primarily of the following major categories: • technical infrastructure, which consists of our investments in servers and network equipment for computing, storage, and networking requirements for ongoing business activities, including AI, and data center land and building construction; and • office facilities, ground-up development projects, and building improvements (also referred to as "fit-outs").
Capital Expenditures Our capital investments in property and equipment consist primarily of the following major categories: • technical infrastructure, which consists of our investments in servers and network equipment, data center land, and building construction and improvements; and • office facilities, ground-up development projects, and building improvements.
For more information related to our content licenses, see Note 10 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. In addition, we regularly enter into multi-year, non-cancellable agreements to purchase renewable energy and energy attributes, such as renewable energy certificates. These agreements do not include a minimum dollar commitment.
For additional information on credit derivatives and financial guarantees, see Note 3 and Note 10 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. In addition, we regularly enter into multi-year, non-cancellable power purchase agreements with third-party suppliers that do not include a minimum dollar commitment.
As of December 31, 2024, we have entered into leases that have not yet commenced with future short-term and long-term lease payments of $773 million and $6.5 billion, respectively, that are not yet recorded on our Consolidated Balance Sheets. These leases will commence between 2025 and 2028 with non-cancelable lease terms of one to 25 years.
As of December 31, 2025, we have entered into leases primarily related to data centers that have not yet commenced with short-term and long-term future lease payments of $5.8 billion and $52.7 billion, respectively. These leases will commence between 2026 and 2031 with non-cancelable lease terms primarily between one and 25 years.
Changes in cost-per-click and cost-per-impression are driven by a number of interrelated factors including changes in device mix, geographic mix, advertiser spending, ongoing product and policy changes, product mix, property mix, and changes in foreign currency exchange rates. 36. Table of Contents Alphabet Inc.
Changes in cost-per-click and cost-per-impression are driven by a number of interrelated factors including changes in device mix, geographic mix, advertiser spending, ongoing product and policy changes, product mix, property mix, and changes in foreign currency exchange rates. Google Subscriptions, Platforms, and Devices Google subscriptions, platforms, and devices revenues increased $7.7 billion from 2024 to 2025.
We regularly evaluate our cash and capital structure, including the size, pace, and form of capital return to stockholders.
The primary use of capital continues to be to invest for the long-term growth of the business. We regularly evaluate our cash and capital structure, including the size, pace, and form of capital return to stockholders.
For additional information, see Note 11 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. • Repurchases of Class A and Class C shares were $11.9 billion and $50.2 billion, respectively, totaling $62.0 billion for the year ended December 31, 2024.
As of December 31, 2025, $69.5 billion remained available for Class A and Class C share repurchases. For additional information, see Note 11 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.
Financial Results Revenues The following table presents revenues by type (in millions): Year Ended December 31, 2023 2024 Google Search & other $ 175,033 $ 198,084 YouTube ads 31,510 36,147 Google Network 31,312 30,359 Google advertising 237,855 264,590 Google subscriptions, platforms, and devices 34,688 40,340 Google Services total 272,543 304,930 Google Cloud 33,088 43,229 Other Bets 1,527 1,648 Hedging gains (losses) 236 211 Total revenues $ 307,394 $ 350,018 Google Services Google advertising revenues Google Search & other Google Search & other revenues increased $23.1 billion from 2023 to 2024.
Financial Results Revenues The following table presents revenues by type (in millions): Year Ended December 31, 2024 2025 Google Search & other $ 198,084 $ 224,532 YouTube ads 36,147 40,367 Google Network 30,359 29,792 Google advertising 264,590 294,691 Google subscriptions, platforms, and devices 40,340 48,030 Google Services total 304,930 342,721 Google Cloud 43,229 58,705 Other Bets 1,648 1,537 Hedging gains (losses) 211 (127) Total revenues $ 350,018 $ 402,836 Google Services Google Advertising Google Search & other Google Search & other revenues increased $26.4 billion from 2024 to 2025.
In April 2024, the Board of Directors of Alphabet authorized the company to repurchase up to an additional $70.0 billion of its Class A and Class C shares. As of December 31, 2024 , $44.7 billion remained available for Class A and Class C share repurchases.
In April 2024, the company's Board of Directors authorized a $70.0 billion share repurchase program for its Class A and Class C shares. In April 2025, the company's Board of Directors authorized an additional $70.0 billion share repurchase program for its Class A and Class C shares.
Costs and Expenses Cost of Revenues The following table presents cost of revenues, including TAC (in millions, except percentages): Year Ended December 31, 2023 2024 TAC $ 50,886 $ 54,900 Other cost of revenues 82,446 91,406 Total cost of revenues $ 133,332 $ 146,306 Total cost of revenues as a percentage of revenues 43 % 42 % Cost of revenues increased $13.0 billion from 2023 to 2024 due to an increase in other cost of revenues and TAC of $9.0 billion and $4.0 billion, res pectively.
Cost of Revenues The following table presents cost of revenues, including TAC (in millions, except percentages): Year Ended December 31, 2024 2025 TAC $ 54,900 $ 59,926 Other cost of revenues 91,406 102,609 Total cost of revenues $ 146,306 $ 162,535 Total cost of revenues as a percentage of revenues 42 % 40 % Cost of revenues increased $16.2 billion from 2024 to 2025 due to an increase in other cost of revenues and TAC of $11.2 billion and $5.0 billion, respectively.
We expect TAC paid to our distribution partners and Google Network partners to increase as our revenues grow and TAC as a percentage of our advertising revenues ("TAC rate") to be affected by changes in device mix; geographic mix; partner agreement terms; partner mix; the percentage of queries channeled through paid access points; product mix; the relative revenue growth rates of advertising revenues from different channels; and revenue share terms.
Our TAC rate will continue to be affected by changes in device mix; geographic mix; partner agreement terms; partner mix; the percentage of queries channeled through paid access points; product mix; the relative revenue growth rates of advertising revenues from different channels; and revenue share terms. • We have raised capital through external financing in the form of debt and we may continue to seek debt or other forms of financing in the future to support our capital and operating needs.
The increase in operating income was primarily driven by an increase in revenues, partially offset by increases in content acquisition costs and TAC. Additionally, a reduction in employee compensation expenses contributed to the increase in operating income. Google Cloud Google Cloud operating income increased $4.4 billion from 2023 to 2024.
Google Services Google Services operating income increased $18.1 billion from 2024 to 2025. The increase in operating income was primarily driven by an increase in revenues, partially offset by an increase in expenses related to legal and other matters, TAC, and content acquisition costs. Google Cloud Google Cloud operating income increased $7.8 billion from 2024 to 2025.
As of December 31, 2024, the amount of total future lease payments under operating leases, which had a weighted average remaining lease term of 7.8 years, was $17.0 billion, of which $3.2 billion is short-term, and total future lease payments under finance leases, which had a weighted average remaining lease term of 10.4 years, was $1.9 billion, of which $257 million is short-term.
Leases As of December 31, 2025, the amount of total undiscounted future lease payments under operating leases was $18.3 billion, of which $3.3 billion is short-term, and total undiscounted future lease payments under finance leases was $2.9 billion, of which $491 million is short-term.
Net cash used in financing activities increased from 2023 to 2024 due to dividend payments and net payments related to stock-based award activities, partially offset by an increase in proceeds from issuance of debt, net of repayments. 41. Table of Contents Alphabet Inc.
Net cash used in financing activities decreased from 2024 to 2025 due to an increase in proceeds from issuance of debt and a decrease in repurchases of stock, partially offset by repayments of debt.
The increase in operating loss was primarily due to an increase in expenses, largely driven by employee compensation expenses in addition to a combination of factors, none of which were individually significant.
The increase in operating loss was primarily driven by an increase in employee compensation expenses largely due to an increase in a valuation-based compensation charge related to Waymo.
Google subscriptions, platforms, and devices Google subscriptions, platforms, and devices revenues increased $5.7 billion from 2023 to 2024. The growth was primarily driven by an increase in subscription revenues, largely from growth in the number of paid subscribers for YouTube services followed by Google One.
The growth was primarily driven by an increase in subscriptions revenues. This increase was primarily due to the contribution from growth in paid subscriptions across both YouTube services and Google One. Google Cloud Google Cloud revenues increased $15.5 billion from 2024 to 2025, primarily driven by growth in Google Cloud Platform largely from infrastructure and platform services.
Other Income (Expense), Net The following table presents OI&E, (in millions): Year Ended December 31, 2023 2024 Interest income $ 3,865 $ 4,482 Interest expense (308) (268) Foreign currency exchange gain (loss), net (1,238) (409) Gain (loss) on debt securities, net (1,215) (1,043) Gain (loss) on equity securities, net 392 3,714 Performance fees 257 218 Income (loss) and impairment from equity method investments, net (628) (188) Other 299 919 Other income (expense), net $ 1,424 $ 7,425 OI&E, net increased $6.0 billion from 2023 to 2024 primarily due to an increase in net gains on equity securities and a decrease in net losses on foreign currency exchange.
Other Income (Expense), Net The following table presents OI&E, (in millions): Year Ended December 31, 2024 2025 Interest income $ 4,482 $ 4,337 Interest expense (268) (736) Foreign currency exchange gain (loss), net (409) (382) Gain (loss) on debt securities, net (1,043) 540 Gain (loss) on equity securities, net 3,714 24,080 Income (loss) and impairment from equity method investments, net (188) 281 Other 1,137 1,667 Other income (expense), net $ 7,425 $ 29,787 OI&E, net increased $22.4 billion from 2024 to 2025, primarily due to increases in net unrealized gains on equity securities resulting from fair value adjustments on non-marketable equity securities.
No amounts have been borrowed under the credit facilities. For additional information, see Note 6 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. 42. Table of Contents Alphabet Inc. We primarily utilize contract manufacturers for the assembly of our servers used in our technical infrastructure and devices we sell.
For additional information, see Note 6 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. We use contract manufacturers for our technical infrastructure and device assembly and may supply them with components purchased directly from suppliers.
Depreciation of our property and equipment commences when the deployment of such assets are completed and are ready for our intended use. For the years ended December 31, 2023 and 2024, our depreciation on property and equipment was $11.9 billion and $15.3 billion, respectively.
For the years ended December 31, 2024 and 2025, our depreciation on property and equipment was $15.3 billion and $21.1 billion, respectively.
In addition, acquisitions and strategic investments remain important elements in our use of capital and contribute to the breadth and depth of our offerings, expand our expertise in engineering and other functional areas, and build strong partnerships around strategic initiatives. • We continue to face an evolving regulatory environment, and we are subject to claims, lawsuits, investigations, and other forms of potential legal liability, which could affect our business practices and financial results.
A cquisitions and strategic investments remain important elements in our use of capital and contribute to the breadth and depth of our offerings, expand our expertise in engineering and other functional areas, and build strong partnerships around strategic initiatives.
Financial Condition Cash, Cash Equivalents, and Marketable Securities As of December 31, 2024 , we had $95.7 billion in cash, cash equivalents, and short-term marketable securities. Ca sh equivalents and marketable securities a re comprised of time deposits, money market funds, highly liquid government bonds, corporate debt securities, mortgage-backed and asset-backed securities, and marketable equity securities.
Ca sh equivalents and marketable securities a re comprised of time deposits, money market funds, highly liquid government bonds, corporate debt securities, mortgage-backed and asset-backed securities, and marketable equity securities. Sources, Uses of Cash and Related Trends Our principal sources of liquidity are cash, cash equivalents, and marketable securities, as well as the cash flow that we generate from operations.
The increase in other cost of revenues from 2023 to 2024 was primarily due to increases in content acquisition costs, largely for YouTube, depreciation expense, and other technical infrastructure operations costs. Research and Development The following table presents R&D expenses (in millions, except percentages): 38. Table of Contents Alphabet Inc.
The TAC rates on Google Search & other and Google Network revenues were substantially consistent from 2024 to 2025. The increase in other cost of revenues from 2024 to 2025 was primarily due to increases in content acquisition costs, largely for YouTube, depreciation expense, and other technical infrastructure operations costs.
The company intends to pay quarterly cash dividends in the future, subject to review and approval by the company’s Board of Directors in its sole discretion.
The company has declared a quarterly cash dividend in the current quarter, and intends to pay quarterly cash dividends in the future, subject to review and approval by the company’s Board of Directors in its sole discretion. Accrued Legal and Regulatory As of December 31, 2025, we had short-term accrued legal and regulatory fines and settlements of $15.6 billion.
Revenues from cloud, consumer subscriptions, platforms, and devices, which may have differing characteristics than our advertising revenues, have grown over time, and we expect this trend to continue as we focus on expanding our products and services. The margins on these revenues vary significantly and are generally lower than the margins on our advertising revenues.
Increasing Revenues Beyond Advertising: Revenues from cloud, consumer subscriptions, platforms, and devices, which may have differing characteristics than our advertising revenues, have grown over time. Certain of these revenues have been growing at a rate higher than our advertising revenues, becoming a larger percentage of our consolidated revenues, and we expect this trend to continue.
The unrealized gain reflects an increase in the fair value measurement of our investment following an observable transaction in January 2025. For additional information, see Note 3 and Note 7 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.
For additional information, see Note 2 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. Costs and Expenses 34. Table of Contents Alphabet Inc.
Dividend Program During the year ended December 31, 2024 total cash dividends, which were first paid in June 2024, were $3.5 billion, $519 million, and $3.3 billion for Class A, Class B, and Class C shares, respectively.
Dividend Program During the year ended December 31, 2025, total cash dividends were $4.8 billion for Class A, $703 million for Class B, and $4.5 billion for Class C shares, respectively. In April 2025, the company's Board of Directors increased the quarterly cash dividend by 5% to $0.21 per share of outstanding Class A, Class B, and Class C shares.
General and Administrative The following table presents general and administrative expenses (in millions, except percentages): Year Ended December 31, 2023 2024 General and administrative expenses $ 16,425 $ 14,188 General and administrative expenses as a percentage of revenues 5 % 4 % General and administrative expenses decreased $2.2 billion from 2023 to 2024, primarily driven by a reduction in charges related to legal and other matters of $1.3 billion and a decrease in employee compensation expenses of $285 million, primarily due to a decrease in average headcount, in addition to a combination of factors, none of which were individually significant.
General and Administrative The following table presents general and administrative expenses (in millions, except percentages): Year Ended December 31, 2024 2025 General and administrative expenses $ 14,188 $ 21,482 General and administrative expenses as a percentage of revenues 4 % 5 % General and administrative expenses increased $7.3 billion from 2024 to 2025, primarily driven by an increase in expenses related to legal and other matters of $6.2 billion, largely the result of the $3.5 billion EC fine accrued in the third quarter of 2025 and a $1.4 billion legal accrual made in the second quarter of 2025. 35.
Revenues by Geography The following table presents revenues by geography as a percentage of revenues, determined based on the addresses of our customers: Year Ended December 31, 2023 2024 United States 47 % 49 % EMEA 30 % 29 % APAC 17 % 16 % Other Americas 6 % 6 % Hedging gains (losses) 0 % 0 % For additional information, see Note 2 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.
Revenues by Geography The following table presents revenues by geography as a percentage of revenues, determined based on the addresses of our customers: Year Ended December 31, 2024 2025 United States 49 % 48 % EMEA (1) 29 % 29 % APAC (1) 16 % 17 % Other Americas (1) 6 % 6 % Hedging gains (losses) 0 % 0 % (1) Regions represent Europe, the Middle East, and Africa (EMEA); Asia-Pacific (APAC); and Canada and Latin America ("Other Americas").
For additional information, see Note 4 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. Financing We have a short-term debt financing program of up to $10.0 billion through the issuance of commercial paper. Net proceeds from this program are used for general corporate purposes.
For additional information on leases, see Note 4 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. Financing As of December 31, 2025, we had senior unsecured notes outstanding with a total carrying value of $48.5 billion, of which $2.0 billion was short-term.
We expect to increase, relative to 2024, our i nvestment in our technical infrastructure, including servers, network equipment, and data centers, to support the growth of our business and our long-term initiatives, in particular in support of AI products and services.
We invested heavily in capital expenditures in 2025 and in 2026, we expect to significantly increase , relative to 2025, our i nvestment in our technical infrastructure, including servers and network equipment, and data centers.
Year Ended December 31, 2023 2024 Research and development expenses $ 45,427 $ 49,326 Research and development expenses as a percentage of revenues 15 % 14 % R&D expenses increased $3.9 billion from 2023 to 2024, primarily driven by increases in employee compensation expenses of $1.5 billion, depreciation expense of $1.4 billion, and third-party services fees of $698 million, partially offset by a reduction in charges related to our office space optimization efforts of $640 million.
Research and Development The following table presents research and development expenses (in millions, except percentages): Year Ended December 31, 2024 2025 Research and development expenses $ 49,326 $ 61,087 Research and development expenses as a percentage of revenues 14 % 15 % Research and development expenses increased $11.8 billion from 2024 to 2025, primarily driven by increases in employee compensation expenses of $6.9 billion and depreciation expense of $2.4 billion.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

16 edited+5 added−10 removed4 unchanged
Biggest changeFor certain fixed and variable rate debt securities, we have elected the fair value option for which changes in fair value are recorded in OI&E. We measure securities for which we have not elected the fair value option at fair value with gains and losses recorded in AOCI until the securities are sold, less any expected credit losses.
Biggest changeWe measure securities for which we have not elected the fair value option at fair value with gains and losses recorded in AOCI until the securities are sold, less any expected credit losses. We use value-at-risk (VaR) analysis to determine the potential effect of fluctuations in interest rates on the value of our investment portfolio.
For additional information about our equity investments, see Note 1 and Note 3 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. 47. Table of Contents Alphabet Inc.
For additional information about our equity investments, see Note 1 and Note 3 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. 43. Table of Contents Alphabet Inc.
The estimated one-day loss in fair value of our investment portfolio as of December 31, 2023 and 2024 are shown below (in millions): As of December 31, 12-Month Average As of December 31, 2023 2024 2023 2024 Risk category - interest rate $ 296 $ 208 $ 271 $ 230 Actual future gains and losses associated with our investment portfolio may differ materially from the sensitivity analyses performed as of December 31, 2023 and 2024 due to the inherent limitations associated with predicting the timing and amount of changes in interest rates and our actual exposures and positions.
The estimated one-day loss in fair value of our investment portfolio as of December 31, 2024 and 2025 are shown below (in millions): As of December 31, 12-Month Average As of December 31, 2024 2025 2024 2025 Risk category - interest rate $ 208 $ 162 $ 230 $ 184 Actual future gains and losses associated with our investment portfolio may differ materially from the sensitivity analyses performed as of December 31, 2024 and 2025 due to the inherent limitations associated with predicting the timing and amount of changes in interest rates and our actual exposures and positions.
The carrying values of our equity method investments, which totaled approximately $1.7 billion and $2.0 billion as of December 31, 2023 and 2024 , respectively, generally do not fluctuate based on market price changes. However, these investments could be impaired if the carrying value exceeds the fair value and is not expected to recover.
The carrying values of our equity method investments, which totaled approximately $2.0 billion and $2.5 billion as of December 31, 2024 and 2025 , respectively, generally do not fluctuate based on market price changes. However, these investments could be impaired if the carrying value exceeds the fair value and is not expected to recover.
Valuations of our equity investments in private companies are inherently more complex due to the lack of readily available market data and 46. Table of Contents Alphabet Inc. observable transactions at lower valuations could result in significant losses. In addition, global economic conditions could result in additional volatility.
Valuations of our equity investments in private companies are inherently more complex due to the lack of readily available market data and observable transactions at lower valuations could result in significant losses. In addition, global economic conditions could result in additional volatility.
Changes in the valuation of non-marketable equity securities may not directly correlate with changes in valuation of marketable equity securities. As of December 31, 2023 and 2024, the carrying value of our non-marketable equity securities, which were accounted for under the measurement alternative, was $28.8 billion and $35.5 billion, respectively.
Changes in the valuation of non-marketable equity securities may not directly correlate with changes in valuation of marketable equity securities. As of December 31, 2024 and 2025, the carrying value of our non-marketable equity securities, which were accounted for under the measurement alternative, was $35.2 billion and $64.1 billion, respectively.
We use value-at-risk (VaR) analysis to determine the potential effect of fluctuations in interest rates on the value of our investment portfolio. The VaR is the expected loss in fair value, for a given confidence interval, for our investment portfolio due to adverse movements in interest rates. We use a variance/covariance VaR model with 95% confidence interval.
The VaR is the expected loss in fair value, for a given confidence interval, for our investment portfolio due to adverse movements in interest rates. We use a variance/covariance VaR model with 95% confidence interval.
Our non-marketable equity securities not accounted for under the equity method are primarily adjusted to fair value for observable transactions for identical or similar investments of the same issuer or impairment (referred to as the measurement alternative).
From time to time, we may enter into derivatives to hedge the market price risk on certain of our marketable equity securities. Our non-marketable equity securities not accounted for under the equity method are primarily adjusted to fair value for observable transactions for identical or similar investments of the same issuer or impairment (referred to as the measurement alternative).
Our marketable equity securities are publicly traded stocks or funds and our non-marketable equity securities are investments in privately held companies, some of which are in the startup or development stages.
Our marketable equity securities are primarily publicly traded stocks or funds and our non-marketable equity securities are primarily investments in privately held companies, some of which are in the startup or development stages. We record marketable equity securities at fair value subject to market price volatility.
VaR analysis is not intended to represent actual losses but is used as a risk estimation. Equity Investment Risk Our marketable and non-marketable equity securities are subject to a wide variety of market-related risks that could substantially reduce or increase the fair value of our holdings.
Equity Investment Risk Our marketable and non-marketable equity securities are subject to a wide variety of market-related risks that could substantially reduce or increase the fair value of our holdings. 42. Table of Contents Alphabet Inc.
Fixed rate securities may have their fair market value adversely affected due to a rise in interest rates, while floating rate securities may produce less income than predicted if interest rates fall. Unrealized gains and losses on our marketable debt securities are primarily due to interest rate fluctuations as compared to interest rates at the time of purchase.
Our investments in both fixed rate and floating rate interest earning securities carry a degree of interest rate risk. Fixed rate securities may have their fair market value adversely affected due to a rise in interest rates, while floating rate securities may produce less income than predicted if interest rates fall.
For the purpose of analyzing foreign currency exchange risk, we considered the historical trends in foreign currency exchange rates and determined that it was reasonably possible that adverse changes in exchange rates of 10% could be experienced.
Considering historical trends in foreign exchange rates, we determined that it was reasonably possible that adverse changes in exchange rates of 10% could be experienced. We performed a sensitivity analysis on our foreign currency exposures to estimate the potential impact of this adverse 10% change.
International revenues, as well as costs and expenses denominated in foreign currencies, expose us to the risk of fluctuations in foreign currency exchange rates against the U.S. dollar. As discussed below, we enter into derivative instruments to hedge foreign currency risk. Principal currencies hedged included the Australian dollar, British pound, Canadian dollar, Euro, and Japanese yen.
International revenues, foreign-denominated monetary assets and liabilities, and investments in foreign subsidiaries expose us to the risk of fluctuations in foreign exchange rates against the US dollar. Principal currency exposures include the Australian dollar, British pound, Canadian dollar, Euro, and Japanese yen. 41. Table of Contents Alphabet Inc.
A hypothetical adverse price change of 10% on our December 31, 2024 balance would decrease the fair value of marketable equity securities by $508 million. From time to time, we may enter into derivatives to hedge the market price risk on certain of our marketable equity securities.
These securities represent $5.1 billion and $6.3 billion of our investments as of December 31, 2024 and 2025, respectively. A hypothetical adverse price change of 10% on our December 31, 2025 balance would decrease the fair value of marketable equity securities by $631 million.
The change in the value recorded in AOCI would be expected to offset a corresponding foreign currency change in forecasted hedged revenues when recognized. We use foreign exchange forward contracts designated as net investment hedges to hedge the foreign currency risks related to investment in foreign subsidiaries.
(2) The change in accumulated other comprehensive income (AOCI) would be expected to offset a corresponding foreign currency change in forecasted hedged revenues when recognized. (3) The change in AOCI would be expected to offset a corresponding foreign currency translation gain or loss from our investments in foreign subsidiaries.
The change in value recorded in CTA would be expected to offset a corresponding foreign currency translation gain or loss from our investment in foreign subsidiaries. Interest Rate Risk Our Corporate Treasury investment strategy is to achieve a return that w ill allow us to preserve capital and maintain liquidity.
Interest Rate Risk We are exposed to interest rate risk related to our investment portfolio and outstanding debt. Our Corporate Treasury investment strategy is to achieve a return that w ill allow us to preserve capital and maintain liquidity. By policy, we limit the amount of credit exposure within our investment portfolio to any one issuer.
Removed
We use foreign currency forward and option contracts to offset the foreign exchange risk on monetary assets and liabilities denominated in currencies other than the functional currency of the subsidiary. These forward and option contracts reduce, but do not entirely eliminate, the effect of foreign currency exchange rate movements on our assets and liabilities.
Added
We monitor our foreign currency exposures and hedge foreign exchange risks with derivative and non-derivative instruments, including forwards, options (including collars), cross-currency swaps, and foreign currency-denominated debt. Gains or losses on these foreign currency exposures are generally offset by corresponding gains or losses on the derivative and non-derivative instruments.
Removed
The foreign currency gains and losses on these assets and liabilities are recorded in OI&E, which are offset by the gains and losses on the forward and option contracts.
Added
The estimated effects on our financial position would be as follows (in millions): As of December 31, Impact 2024 2025 Foreign currency risk Foreign denominated monetary assets and liabilities (1) OI&E $ 135 $ 671 Cash flow hedges of foreign currency revenue (2) AOCI $ 1,627 $ 2,096 Net investment hedges of investments in foreign subsidiaries (3) AOCI $ 660 $ 2,942 (1) After consideration of the effect of derivative contracts.
Removed
If an adverse 10% foreign currency exchange rate change was applied to net monetary assets, liabilities, and commitments denominated in currencies other than the functional currencies at the balance sheet date, it would have resulted in an adverse effect on income before income taxes of approxima tely $503 million and $135 million as of December 31, 2023 and 2024, respectively, after consideration of the effect of foreign exchange contracts in place for the years ended December 31, 2023 and 2024.
Added
Unrealized gains and losses on our marketable debt securities are primarily due to interest rate fluctuations as compared to interest rates at the time of purchase. For certain fixed and floating rate debt securities, we have elected the fair value option for which changes in fair value are recorded in OI&E.
Removed
We use foreign currency forward and option contracts, including collars (an option strategy comprised of a combination of purchased and written options) to protect forecasted U.S. dollar-equivalent earnings from changes in foreign currency exchange rates. When the U.S. dollar strengthens, gains from foreign currency forward and option contacts reduce the foreign currency losses related to our earnings.
Added
VaR analysis is not intended to represent actual losses but is used as a risk estimation. Additionally, we had senior unsecured notes outstanding with a total carrying value of $11.9 billion and $48.5 billion as of December 31, 2024 and 2025, respectively.
Removed
When the U.S. dollar weakens, losses from foreign currency forward and option contracts offset the foreign currency gains related to our earnings. These hedging contracts reduce, but do not entirely eliminate, the effect of foreign currency exchange rate movements. We designate these contracts as cash flow hedges for accounting purposes.
Added
As our senior unsecured notes primarily bear interest at fixed rates and are recorded at amortized cost, interest rate fluctuations generally do not affect our consolidated financial statements. However, the fair value of the notes will fluctuate with movement in market interest rates.
Removed
We reflect the gains and losses of foreign currency spot rate changes as a component of accumulated other comprehensive income (AOCI) and subsequently reclassify them into revenues to offset the hedged exposures as they occur.
Removed
I f the U.S. dollar weakened by 10% as of December 31, 2023 and 2024, the amount recorded in AOCI related to our cash flow hedges before tax effect would have been approximately $1.5 billion and $1.6 billion lower as of 45. Table of Contents Alphabet Inc. December 31, 2023 and 2024, respectively.
Removed
These forward contracts serve to offset the foreign currency translation risk from our foreign operations. If the U.S. dollar weakened by 10%, the amount recorded in cumulative translation adjustment (CTA) within AOCI related to our net investment hedges before tax effect would have been approximately $946 million and $660 million lower as of December 31, 2023 and 2024, respectively.
Removed
We invest primarily in debt securities, including government bonds, corporate debt securities, mortgage-backed and asset-backed securities, money market and other funds, time deposits, and interest rate derivatives. By policy, we limit the amount of credit exposure to any one issuer. Our investments in both fixed rate and floating rate interest earning securities carry a degree of interest rate risk.
Removed
We record marketable equity securities not accounted for under the equity method at fair value based on readily determinable market values, of which publicly traded stocks and mutual funds are subject to market price volatility, and represent $6.0 billion and $5.1 billion of our investments as of December 31, 2023 and 2024, respectively.

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