Alphabet's Google Cloud Backlog Just Hit a Record $462 Billion. Time to Buy the Stock?

Keithen Drury, The Motley Fool

Tue, June 23, 2026 astatine 9:35 AM CDT 4 min read

Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) is 1 of the superior artificial quality (AI) hyperscalers. Unlike immoderate of the different hyperscalers, it's approaching this monolithic inclination from 2 directions.

First, it has its ain household of ample connection models, led by Gemini. It has integrated this exemplary passim assorted products (like Google Search) and is among the astir fashionable generative AI models retired there. Second, it has a thriving unreality computing concern successful Google Cloud. Google Cloud conscionable deed a $462 cardinal backlog, which is monolithic compared to its past 12 months of revenue.

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I deliberation this is arsenic compelling a crushed arsenic immoderate to bargain the stock, arsenic the maturation implied by this backlog is massive. With Alphabet's banal down astir 10% from its all-time high, present whitethorn beryllium the cleanable clip to bargain shares.

Google Cloud is simply a apical crushed to bargain Alphabet's banal

During Q1, Alphabet's Google Cloud quarterly gross reached $20 billion. So, astatine this mark, it volition instrumentality astir 23 quarters to churn done the $463 cardinal backlog. However, Google has nary plans to fto that backlog past for much than 5 years. Google Cloud is rapidly growing, and it has accrued its gross astatine a jaw-dropping 63% twelvemonth implicit year. Compared to different unreality computing firms, this is simply a acold greater maturation rate.

Amazon's Amazon Web Services (AWS) grew astatine a 28% clip and added $8.3 cardinal successful caller business. Google Cloud added $7.8 billion. So, conscionable due to the fact that Google Cloud is trailing the manufacture person close present successful wide size, it doesn't mean that it isn't adding arsenic overmuch caller business. Microsoft's Azure unreality level grew its gross astatine a 40% clip, but the institution doesn't interruption retired the existent gross figures; that's inactive a slower maturation complaint than for Google Cloud.

Google Cloud has a ton of momentum, and it's readying connected carrying that into the adjacent fewer years arsenic it churns done the backlog. It is spending a monolithic magnitude of wealth connected information halfway superior expenditures and precocious bumped its 2026 guidance to walk betwixt $180 cardinal and $190 cardinal this year. Demand for AI computing powerfulness has ne'er been higher, and Alphabet is spending large to marque definite that it has the capableness that its clients want. While 2026's expenditures are massive, Alphabet's absorption squad noted successful the telephone that 2027's superior expenditures volition beryllium "significantly" higher.