● Alphabet Revenue up 25% to about $128bn. Google Cloud up 103%. Gemini app at one billion users.
● Microsoft Revenue $92.3bn, up 19%. Azure up 48%. Backlog up 73% to $677bn.
● The difference Alphabet is showing you usage. Microsoft is showing you contracts. Only one of those is already paid for.
| Alphabet Q3 2026 | Microsoft Q1 FY27 |
|---|
| Reported | 29 October 2026 | 28 October 2026 |
| Total revenue | About $128bn, up 25% year over year | $92.3bn, up 19% |
| Cloud line | Google Cloud up 103% | Microsoft Cloud $63.9bn, up 30% (31% constant currency) |
| Flagship cloud growth | Google Cloud 103% | Azure 48% |
| Operating income | Not stated in the CEO remarks | $45.9bn, up 21% (22% cc) |
| Contracted backlog | Not stated in the CEO remarks | Commercial RPO up 73% to $677bn |
| AI usage disclosed | Nearly 32 billion tokens per minute, 40% up on last quarter | Not disclosed in the release |
| Consumer AI scale | Gemini app at one billion users | Not disclosed in the release |
Alphabet is measuring demand in tokens
Alphabet reported third-quarter revenue growth of 25% year over year to roughly $128 billion, with Google Cloud up 103%. A cloud business doubling at that scale is the headline number, and it is a large one.
The more interesting disclosures are the usage figures, because they are not financial. Alphabet says its model APIs are running at nearly 32 billion tokens per minute, 40% higher than last quarter, and that the Gemini app has reached one billion users. Those are consumption metrics: they tell you what is actually being run right now, not what somebody has promised to buy.
Microsoft is measuring demand in signed contracts
Microsoft reported revenue of $92.3 billion, up 19%, with Microsoft Cloud at $63.9 billion, up 30%, Azure up 48%, and operating income of $45.9 billion, up 21%. On growth rates alone, Google Cloud at 103% is the faster business.
But the number that carries the most information in either release is Microsoft’s backlog: commercial remaining performance obligation up 73% to $677 billion. That is contracted revenue not yet recognised - work customers have committed to buying and have not yet consumed. It is a forward indicator in a way that a quarterly growth rate is not.
Why the two metrics are not interchangeable
Tokens per minute and remaining performance obligation measure different things at different ends of the same pipeline, and each flatters its reporter.
- Tokens per minute is real but unpriced. 32 billion tokens a minute proves the capacity is being used. It does not say at what margin, or how much of it is free-tier consumption inside a product like the Gemini app.
- Backlog is priced but unconsumed. $677 billion of RPO is contracted at known prices. It does not say when it converts, and multi-year cloud commitments routinely convert more slowly than the signing announcement implies.
- One billion app users is scale, not revenue. It is the number that matters for distribution and for training feedback, and the one that says least about this quarter’s profit.
Read together, they describe the same market from two sides. Alphabet is demonstrating that inference demand is here now. Microsoft is demonstrating that buyers have signed up for years of it in advance. Neither company published the other’s number, which is itself worth noticing.
What to watch next quarter
| Metric | What would confirm the story | What would undercut it |
|---|
| Alphabet tokens per minute | Another 30%+ sequential rise | Growth flattening while Cloud growth holds - usage and revenue decoupling |
| Google Cloud growth | Holding above 80% against a larger base | A sharp step down, which would make 103% a one-quarter comparison effect |
| Microsoft RPO | Conversion into recognised Azure revenue | Backlog growing while Azure growth slows - contracts not converting |
| Azure growth | Holding near 48% | Decelerating while RPO climbs, which would widen the same gap |
Frequently asked questions
How much did Alphabet grow in Q3 2026?
Alphabet reported revenue growth of 25% year over year, to roughly $128 billion, with Google Cloud revenue up 103%.
What was Microsoft Azure growth in Q1 FY27?
Azure revenue increased 48%. Microsoft Cloud overall was $63.9 billion, up 30%, and total company revenue was $92.3 billion, up 19%.
What is remaining performance obligation?
It is contracted revenue a company has not yet recognised - work customers have committed to buy but have not yet consumed. Microsoft reported commercial RPO up 73% to $677 billion, which is a forward indicator of demand rather than a measure of this quarter.
How many tokens is Google processing?
Alphabet says its model APIs are running at nearly 32 billion tokens per minute, which it states is 40% higher than the previous quarter.
How many people use the Gemini app?
Alphabet says the Gemini app has reached one billion users.
Which company is winning in AI?
They are reporting different things, so the question does not resolve cleanly. Alphabet has the faster cloud growth rate at 103% against Azure’s 48%, and the only published inference usage figures. Microsoft has the larger disclosed contracted backlog at $677 billion. Growth rate favours Google; visibility of future revenue favours Microsoft.
Related
Sources
Every figure on this page was read from the sources above on 30 October 2026. Where a vendor has not published a number, this page says so rather than repeating a third-party estimate.