Google Cloud 1Q26 Revenue Surges 63% to $20B, Backlog Jumps $222B
UBS maintained its buy rating on Google as Google Cloud posted 63% revenue growth to $20.03B in 1Q26 and expanded operating margin to 33% from 18% a year earlier. Its committed backlog jumped $222B sequentially to $462B on new TPU chip sale agreements set to convert revenue in 2027.
1. UBS Maintains Buy Rating
UBS maintained its buy rating on Google, citing sustained demand for AI computing capacity across its cloud platform.
2. 1Q26 Revenue Growth
Google Cloud revenue in 1Q26 rose 63% year-over-year to $20.03B, a 35-point acceleration from 1Q25 that outpaced AWS's 28% growth and Azure's steady 39%.
3. Backlog Expansion
Google's committed cloud backlog jumped by $222B sequentially to $462B, driven by new TPU chip sale agreements scheduled to convert to revenue in 2027.
4. Margin Improvement
Operating margin for Google Cloud expanded to 33% in 1Q26 from 18% a year earlier, reflecting improved efficiency and pricing in AI-related services.
