Alphabet hits a milestone as it closes in on Nvidia

By Christine Ji and Britney Nguyen

Alphabet added a record $421 billion to its market cap on Thursday as massive cloud growth and AI momentum sends shares soaring

Google Cloud's backlog nearly doubled in the first quarter to reach $462 billion.

Shares of Alphabet closed at an all-time high on Thursday following a stellar earnings report that has investors hyped for its artificial-intelligence opportunity.

Alphabet shares (GOOGL) (GOOG) rose 10% on Thursday, adding $421 billion to the company's market capitalization, according to Dow Jones Market Data. That marked Alphabet's largest one-day market-cap gain ever, and the second-largest single-day add for any U.S. company - behind an Nvidia (NVDA) instance from back in April 2025.

The market-cap gap between Alphabet and Nvidia now stands at roughly $202.92 billion - the narrowest gap since Feb. 5, when it was $169 billion, according to Dow Jones Market Data.

Investors were blown away by Google Cloud's momentum, as the company reported revenue growth of 63% for the segment. That, combined with strengthened conviction in Google's full-stack AI approach, has sent shares of Alphabet up 33.8% so far this month - their best monthly performance since October 2004, also according to Dow Jones Market Data.

"We believe Google is generating clear, measurable returns on its AI investments," J.P. Morgan analyst Doug Anmuth wrote in a Thursday note. He pointed out that Google Cloud's backlog nearly doubled sequentially to $462 billion in the first quarter.

AI solutions are now the primary growth driver for Google Cloud, with customers showing high demand for Gemini-powered AI agents, the company said on the earnings call. Cloud operating margins improved as well, expanding to 32.9% from 17.8% a year ago. Management attributed that to more efficient technical infrastructure and process innovation.

"The virtuous cycle of underlying silicon, model improvement, user engagement and monetization continues to compound," Anmuth said.

Read: Why Alphabet's stock is the standout gainer on Big Tech's monster earnings day

Alphabet has spent the past year dismantling the narrative that AI would be an existential threat to its business, emerging as the standout AI leader among the "Magnificent Seven." Investors feared that Google Gemini was lagging behind competitors, but Gemini has grown to be the most downloaded AI app behind OpenAI's ChatGPT, according to data from Sensor Tower. Alphabet said on Wednesday's earnings call that Gemini processes over 16 billion tokens per minute, a 60% quarter-over-quarter increase.

Google has also shown that AI has expanded, not cannibalized, its search-engine business. Search grew 19% and queries reached an all-time high in the first quarter of 2026.

Shares of Alphabet have risen 138.5% in the past year, and the company has climbed up the ranks in terms of market cap. In January, Alphabet surpassed Apple (AAPL) in market cap to officially become the second-largest company in the world.

See more: How Alphabet surpassed Apple to become the second-most valuable company in the world

-Christine Ji -Britney Nguyen

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(END) Dow Jones Newswires

04-30-26 1908ET