Google Parent Alphabet's $346 Billion Investment Is Providing a Big Lift to Its Bottom Line -- but It Has Nothing to Do With Artificial Intelligence (AI)

For more than three years, the rise of artificial intelligence (AI) has captured the attention and capital of investors. Analysts at PwC foresee this technology creating more than $15 trillion in global economic value by the turn of the decade.

While Wall Street’s largest publicly traded company and the face of the artificial intelligence revolution, Nvidia, tends to get most of the glory, it’s AI application companies, such as Google parent Alphabet (GOOGL +1.11%)(GOOG +0.98%), that have shone brightest of late.

Image source: Getty Images.

However, AI isn’t the only reason Alphabet’s earnings per share (EPS) have been climbing at a breakneck pace over the last decade. A stunning $346 billion investment into something that has absolutely nothing to do with AI has been fueling the company’s bottom line.

Investors have fallen head over heels for this virtual monopoly

For decades, Alphabet’s bread-and-butter has been its ad-based operations, headed by Google. According to data from GlobalStats, Google has maintained 89% to 93% of global internet search traffic market share over the trailing decade. This makes it the logical choice for businesses looking to target users with their message(s) and bolsters its ad-pricing power.

Furthermore, Alphabet is the parent company of streaming service YouTube, which is the second-most-visited website on the planet behind Google. The introduction of Shorts on a broad basis in 2021 provided YouTube with new ways to insert ads into streamed content.

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NASDAQ: GOOGL

Alphabet

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But Alphabet’s fastest-growing segment is its cloud infrastructure service platform, Google Cloud. Enterprise spending on cloud services was already growing by roughly 20% annually before AI became Wall Street’s hottest trend. Incorporating generative AI solutions and large language model capabilities reaccelerated Google Cloud’s year-over-year sales growth to 48% in the fourth quarter.

Although advertising is a cash-cow operating model, and Google Cloud has promising long-term potential, it’s Alphabet’s investment in itself that’s making waves.

Alphabet has repurchased $346 billion of its own stock over the last 10 years

When it comes to share buybacks, Apple is king, with $841 billion in repurchases since the start of fiscal 2013. But Alphabet is no slouch, with the company registering over $346 billion in buybacks from 2016 through 2025:

• 2016: $3.693 billion
• 2017: $4.846 billion
• 2018: $9.075 billion
• 2019: $18.396 billion
• 2020: $31.149 billion
• 2021: $50.274 billion
• 2022: $59.296 billion
• 2023: $61.504 billion
• 2024: $62.222 billion
• 2025: $45.709 billion

For companies with steady or growing net income, buybacks that more than offset share-based compensation and/or share-driven acquisitions can lower the outstanding share count and boost EPS. Alphabet’s buybacks have lowered its outstanding share count by over 13%.

$GOOGL After 7 years of buybacks and a 13% reduction in share count, Alphabet has returned its share count to levels last seen in 2006. pic.twitter.com/1Sba6zF34b

– Koyfin (@KoyfinCharts) November 19, 2025

Alphabet has more cash on its balance sheet than it knows what to do with. It closed out 2025 with $126.8 billion in combined cash, cash equivalents, and marketable securities and generated $164.7 billion in net cash from its operating activities during the year. Even with nearly $25 billion in share-based compensation doled out in 2025, Alphabet is having no trouble offsetting these shares and lowering its outstanding share count over time.

While AI is Alphabet’s most exciting long-term growth driver, don’t overlook the ongoing impact of its $346 billion (and counting) investment in itself.