{"version":1,"type":"story","url":"https://digestai.news/story/googles-cloud-revenue-surges-82-as-metas-ai-costs-cut-margins","json":"https://digestai.news/story/googles-cloud-revenue-surges-82-as-metas-ai-costs-cut-margins.json","markdown":"https://digestai.news/story/googles-cloud-revenue-surges-82-as-metas-ai-costs-cut-margins.md","slug":"googles-cloud-revenue-surges-82-as-metas-ai-costs-cut-margins","headline":"Google’s cloud revenue surges 82% as Meta’s AI costs cut margins","summary":"Alphabet and Meta both spent tens of billions on AI data centers in the second quarter, but only Google saw a direct return from customers. Google Cloud revenue hit **$24.77 billion**, up **82%** year-over-year, driven by demand for AI-powered services. Nearly **90%** of Fortune 100 companies use **Gemini Enterprise**, and AI features boosted Search traffic by **17%**, helping Google’s operating margin expand to **34%**. The company also reported an **$82.03 billion unrealized equity gain**, inflating its earnings per share to **$9.11** despite no new model or product launch mentioned in the article.\n\nMeta, meanwhile, saw its ad-driven revenue grow **14%** in impressions and **12%** in ad pricing, but expenses rose **55%** to **$42.03 billion**, including **$2.40 billion in legal charges** and **$1.18 billion in severance**. Meta’s CEO, Mark Zuckerberg, called selling AI APIs and compute to third parties a ‘new muscle,’ but the company remains ‘demand constrained’ for compute. Long-term debt rose from **$46.5 billion to $98.2 billion**, and Google’s CFO noted buybacks are paused. Meta’s **$130 billion to $145 billion** capex plan for 2026 hinges on future returns, while Google’s cloud growth must outpace its **nearly fivefold increase in interest expense** to justify its spending.","keyPoints":["Google Cloud revenue hit **$24.77 billion**, up **82%** year-over-year, driven by AI demand and Gemini Enterprise adoption","Meta’s ad revenue grew **14%** in impressions and **12%** in pricing, but expenses rose **55%** to **$42.03 billion**","Google’s operating margin expanded to **34%**, while Meta’s fell to **31%** from **43%** due to higher costs"],"whyItMatters":"Google’s cloud revenue growth shows direct ROI from AI infrastructure spending, unlike Meta’s ad-driven model, which relies on internal AI use. This gap highlights differing business strategies: Google monetizes AI externally, while Meta invests heavily in internal tools with uncertain returns.","category":{"slug":"business","name":"Business & Funding","url":"https://digestai.news/category/business"},"entities":{"companies":["Alphabet","Meta Platforms","Google Cloud","Gemini Enterprise","Facebook"],"models":["Gemini Enterprise","GEM ranking model"],"people":["Mark Zuckerberg","Susan Li"]},"firstPublishedAt":"2026-09-27T19:35:00Z","updatedAt":"2026-09-27T19:35:00Z","sourceCount":1,"hasPrimarySource":false,"sources":[{"outlet":"247wallst.com","title":"Hyperscaler Bang for Buck: The AI Capex ROI Has Two Clear Winners","url":"https://247wallst.com/investing/2026/09/28/hyperscaler-bang-for-buck-the-ai-capex-roi-has-two-clear-winners","publishedAt":"2026-09-27T19:35:00Z","type":"press","primary":false,"lead":true}],"sourceNotes":null,"discussions":[],"thread":{"title":"Tech Giants Race to Monetize AI","url":"https://digestai.news/thread/google-tests-pilot-that-pays-publishers-when-their-content-appears-in-ai-results","storyCount":6},"cite":{"text":"Digest AI, \"Google’s cloud revenue surges 82% as Meta’s AI costs cut margins\", 27 September 2026, https://digestai.news/story/googles-cloud-revenue-surges-82-as-metas-ai-costs-cut-margins","publisher":"Digest AI","title":"Google’s cloud revenue surges 82% as Meta’s AI costs cut margins","datePublished":"2026-09-27T19:35:00Z","url":"https://digestai.news/story/googles-cloud-revenue-surges-82-as-metas-ai-costs-cut-margins"},"generatedBy":"Written by Digest AI's editorial model from the linked sources; the sources are the record.","license":"Headlines, digests and key points are written by Digest AI and may be quoted with a link to the story page. Linked articles belong to their publishers. Terms: https://digestai.news/terms#reuse"}