Sundar Pichai’s big bet begins to pay off, and YouTube may soon fall behind
Once lagging behind, Google Cloud has surged as a key revenue driver for Alphabet, reaching $15 billion in Q3 2025.
Once seen as a distant third in the cloud wars, Google Cloud has quietly become one of Alphabet’s fastest-growing businesses, fuelled by the AI boom and CEO Sundar Pichai’s long-term vision. What was once considered a costly experiment is now threatening to overtake YouTube as Alphabet’s second-largest revenue engine after Search.
Alphabet reported $15 billion in cloud revenue for the third quarter of 2025, up 34% year-on-year, driven by demand for AI infrastructure, data centres and Google’s in-house Gemini AI model. “Google Cloud is one of the most important priorities for Alphabet,” Pichai told Reuters earlier this month, noting that the division’s role will only grow stronger in the company’s next phase.
Also read: I spent 30 days with the Infinix GT 30 5G: Is it the best gaming phone under ₹20000?
The two bets Pichai made in 2019
When Pichai took over as CEO in 2019, he identified YouTube and Google Cloud as his two big bets to diversify Alphabet beyond advertising. YouTube became a global entertainment juggernaut. Google Cloud, meanwhile, bled billions from 2018 to 2022 before turning its first profit in 2023.
Now, with the rise of generative AI, Pichai’s patience seems to be paying off. Google Cloud’s market share has nearly doubled under Thomas Kurian, the former Oracle executive who took charge in 2018. According to Synergy Research Group, it now holds about 13% of the global market, narrowing the gap with Microsoft Azure (20%) and Amazon Web Services (30%).
Also read: Realme GT 8 Pro Aston Martin F1 Limited Edition launching on November 10: All Details
The ‘un-Googling’ of Google Cloud
Kurian’s turnaround strategy involved what insiders call an “un-Googley” shift, from a loose, engineering-first culture to one focused on accountability and client satisfaction. He trimmed costs by opening offices in North Carolina and Poland, revamped sales to focus on industries, and renegotiated internal deals that had overcharged the division.
Betting on chips and even rivals
A major turning point came when Pichai handed control of Google’s TPU (Tensor Processing Unit) chips to the Cloud unit in 2022. That move allowed Kurian to sell Google’s AI hardware directly, even to competitors.
Today, nine of the world’s top ten AI labs, including OpenAI, Anthropic and Safe Superintelligence, run workloads on Google Cloud. Anthropic alone has committed to one million TPUs, a deal worth tens of billions.
For Pichai, the message is clear: the cloud bet has finally come good, and YouTube may soon have a company at the top.
