Alphabet Q1 2026 Earnings Preview

Alphabet Inc. (NASDAQ: GOOG, GOOGL) is set to report Q1 2026 earnings on April 29 after the close. Wall Street consensus expects revenue near $107.0 billion, up about 19% year over year, while earnings per share (EPS) are forecast to decline 4.6% to 6.4% from the prior year, pressured by a near doubling of capital expenditures (capex) on AI infrastructure and rising depreciation.

Consensus Outlook and Cloud Growth

Analysts project Q1 revenue between $106.88 billion and $106.98 billion, with EPS ranging from $2.63 to $2.68, compared with $2.81 in Q1 2025. Refinitiv’s Smart Estimate aligns closely, anticipating a modest negative surprise of about 1.7%. Rising depreciation expenses are expected to weigh on reported EPS despite strong sales growth.

Market sentiment remains positive, with 25 analysts rating the stock a buy, five holding, and none recommending a sell. The average price target stands near $387.7, and models suggest potential post-earnings stock moves of roughly ±5.6%. Shares have gained between 7.7% and 11.2% year to date, about 27.7% over the past 30 days, and nearly 119% over the past year. The 52-week high is $349, with trading around $336 to $350 on April 28.

Google Cloud continues to drive top-line momentum. The segment generated $17.7 billion in revenue in Q4 2025, up 48% year over year, and is expected to exceed 50% growth in Q1 2026. Analysts have raised their outlook for Cloud’s profitability, forecasting an operating margin of about 29.8% in Q2 2026, a 900-basis-point improvement from the prior year. This margin expansion supports revenue gains amid broader corporate AI spending.

Anthropic Investment and Capital Expenditures

Alphabet has guided fiscal 2026 capex to a range of $175 billion to $185 billion, nearly double the $91.4 billion spent in 2025. This increase targets AI infrastructure expansion.

As part of this strategy, Alphabet committed up to $40 billion to Anthropic, including an initial $10 billion tranche at a $350 billion valuation and $30 billion payable upon meeting performance milestones. Before this deal, Alphabet held about a 14% stake in Anthropic, having invested over $3 billion. Secondary market valuations place Anthropic above $800 billion.

The investment aligns with infrastructure scale-up plans. Tensor Processing Unit (TPU) capacity agreements with Google and Broadcom aim for multiple-gigawatt capacity expected online in 2027. On April 24, 2026, the U.S. Department of Defense added Anthropic’s Gemini 3.1 Pro and 3.0 Flash models to its secure GenAI.mil platform, signaling government adoption of Alphabet’s AI technology.

This combination of aggressive infrastructure spending and the Anthropic commitment reflects Alphabet’s push to build AI scale. Analysts expect these investments to support long-term growth but to elevate depreciation and other non-cash charges, pressuring near-term EPS.

Alphabet’s Q1 2026 results will reveal how the company balances strong revenue growth and cloud momentum against rising costs from its AI expansion. The earnings report and related disclosures will clarify the impact of depreciation on profitability and the progress of the Anthropic investment milestones.