Alphabet published a few days ago its latest quarterly resultsresults that break all their records with 112.1 billion dollars in net profit, 298% more than a year ago. The surprise lies in the origin of this profit: almost all of it comes from the accounting revaluation of two stakes in companies that Alphabet does not control: SpaceX, which is already listed on the stock marketand Anthropic, which doesn’t do it yet but he is expected to take the step soon boosted by a financially spectacular 2026.
For Alphabet, advertising grows 24% in the company’s revenue. Google Cloud soars 82%. And yet, 88% of the quarterly net profit comes from the revaluation of two financial bets that today compete with central areas of the group.
In detail. Participation in SpaceX goes back a long way. In 2015, Google invested 900 million when the company was valued at 10,000 million. After the June IPO, at a valuation of 1.77 billionthat package is worth 94.1 billion. A multiple of more than one hundred times the original capital that rewarded Google’s good eye more than ten years ago.
Anthropic’s is a shorter story. And more expensive. Alphabet has injected 13.3 billion into it from April 2023with commitments for up to an additional 30,000 million. The private assessment of the laboratory behind Claude It has gone from 350,000 to 965,000 million in one year. In 10-Q, Alphabet’s private holdings total 124.3 billion. Virtually everything is Anthropic.
Between the lines. On the B-side of the album, Anthropic is signing engineers from DeepMind quite regularly. Its model competes with Gemini in the same field (API for developers, programming agents, business assistants), and a good part of the companies that do not want to be tied to Google choose it precisely for that reason. Every dollar that Anthropic collects from Alphabet also increases the value of Alphabet itself.
SpaceX instead operates starlinkthe satellite network that supplants the ambition that Google tried and left with Project Loon. Sundar Pichai has not sold a single share of SpaceX or Anthropic. And yet, the market has recognized almost 100,000 million in profit from them.
Yes, but. Capital gains are not cash.
- Of the 94.1 billion in SpaceX, 80,000 cannot be sold in the short term.
- And 14,100 are blocked until the third quarter of 2027.
Anthropic remains unlisted, so the valuation is worth until the next round or until the next cut.
The royal treasury, meanwhile, is being emptied. Alphabet has raised its investment guidance for 2026 to the range of 195,000-205,000 million (from the 180-190,000 announced in April), and quarterly free cash flow has gone into the red. The accounting balance of the party is paid by the data centers.
And now what. The restrictions on SpaceX are beginning to be lifted after its first presentation of results as a listed company, scheduled for August 4. With 94 billion in shares blocked and an investment plan that is close to 200 billion annually, Alphabet has obvious reasons to sell part of the position. As soon as possible.
Doing so implies an uncomfortable admission because it recognizes what this quarter already leaves black and white: that the company has earned more by financing its rivals than by running its own business. And with his business it is not that he has earned little. Except that the free cash flow is negative due to the enormous investment that the AI career requires.
Featured image | Xataka with Magnific
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