Sundar Pichai says Alphabet’s combined AI operations "drives a lot of efficiency"

Alphabet CEO Sundar Pichai’s remark referred to Alphabet’s combined AI operations, which include custom chips, Gemini models, its cloud division, and products used by billions. The third-quarter report showed Google Cloud revenue more than doubling to about $31 billion, while its operating margin rose to 36% from 24% a year earlier. Even so, Alphabet shares fell about 13% in early trading the day after its Oct. 30 earnings, as investors reacted to continued heavy spending on data centers that left free cash flow negative. The article says the selloff left the stock at 17 times 2026 earnings estimates, compared with the Nasdaq-100 average of 21, and notes the risk that AI spending could weigh on cash flow if demand cools before data centers pay off.