Google justifies its massive AI spending with a booming cloud business
Google's cloud business is thriving, as companies adopting its AI and AI infrastructure services help the tech giant to report record profits.
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Alphabet investors have been concerned about whether the company's massive spending on artificial intelligence is justified. The company's latest earnings report shows strong financial results that address this concern, with Google Cloud revenue jumping 82% year-over-year to $24.8 billion, driven largely by enterprise AI adoption and infrastructure. The company's overall profit reached $112.1 billion, a massive increase from the previous year, and its backlog of cloud contracting work climbed to $514 billion. Google's CEO stated that the company is confident in its continued investment based on strong demand indicators and long-term deals, suggesting the AI spending is beginning to generate returns.
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