Mountain View, CA — Alphabet Inc., the parent company of tech titan Google, has shattered expectations with its highest-ever quarterly earnings, reporting a staggering $34.5 billion in net income for the first quarter of 2025, a 46% surge year-over-year. Announced on Thursday, April 24, 2025, the blockbuster results were propelled by an $8 billion unrealized gain from its long-standing investment in SpaceX, Elon Musk’s aerospace juggernaut, according to a Bloomberg report citing sources familiar with the matter.
The financial windfall stems from Alphabet’s “Other Income,” which skyrocketed to $11.2 billion—a 293% increase from the previous year—largely driven by the unrealized gains on its “non-marketable equity securities.” Alphabet CFO Anat Ashkenazi addressed this during the earnings call but adhered to the company’s practice of not disclosing specifics about private market investments. However, Bloomberg’s revelation points to SpaceX, where Alphabet, alongside Fidelity Investments, acquired a 10% stake for $1 billion back in 2015. With SpaceX’s valuation soaring to $350 billion in December 2024, Alphabet’s early bet has paid off handsomely, contributing nearly a quarter of its Q1 net income.
Beyond the SpaceX boost, Alphabet’s core businesses showed robust growth. Google’s advertising revenue, encompassing Search and YouTube, climbed to $66.89 billion, up 8.5% from last year, while Google Cloud revenue jumped 28% to $12.26 billion, reflecting strong momentum despite fierce competition in AI and cloud computing. Alphabet’s earnings per share of $2.81 far exceeded Wall Street’s consensus estimate of $2.01, sending shares up 4.63% in after-hours trading on Thursday. The company also announced a $70 billion stock repurchase program, signaling confidence in its financial health.
The SpaceX investment underscores Alphabet’s strategic foresight in diversifying its portfolio. SpaceX, now valued higher than Tesla as Elon Musk’s most valuable venture, has solidified its dominance in the space industry through NASA contracts and its Starlink satellite internet service, which boasts global reach. Alphabet’s gains highlight the potential for tech giants to reap massive rewards from early investments in innovative private companies, even as SpaceX remains unavailable to retail investors due to its private status.
Public reaction has been mixed but intense. On X, some investors celebrated Alphabet’s success, with one user noting, “$GOOGL proves again why it’s a tech leader—smart bets like SpaceX are paying off big time.” Others expressed skepticism about the sustainability of such gains, with a user commenting, “Unrealized gains from SpaceX? Sounds like a house of cards if the market shifts.” Analysts, however, remain optimistic, with Wedbush Securities raising its price target for Alphabet to $200, citing the company’s strong performance across Search, YouTube, and Cloud.
As Alphabet continues to navigate a competitive landscape—bolstered by its $75 billion commitment to AI investment in 2025—the SpaceX windfall positions it as a formidable player in both tech and space innovation. With regulatory scrutiny and market uncertainties looming, Alphabet’s record-breaking Q1 sets a high bar for the quarters ahead, proving that strategic investments can yield out-of-this-world returns.
