Alphabet's $112bn Q2 profit: $99bn is a mark-up on SpaceX and one private stake — in the same quarter it sold $49.6bn of new shares
Q2 10-Q: operating income of $40.8bn (+30%) is the business; the rest is valuation gains. Buybacks fell to zero while June share and convertible-preferred sales raised $49.6bn and first-half bonds $56.2bn. Capex doubled to $80.6bn in the half
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Alphabet Form 10-Q for Q2 2026 (filed 2026-07-31): consolidated statement of income and cash flows, Financial Instruments note (equity securities, SpaceX sale restrictions), Stockholders' Equity note (issuance, preferred, repurchases), MD&A 'Executive Overview' and 'Liquidity'
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Alphabet (GOOGL) reported net income of $112,193m for the second quarter of 2026, four times the $28,196m of a year earlier. The statement of income in the 10-Q filed July 31 shows operating income of $40,770m and an 'Other income (expense), net' line of $97,983m. What that other income is — and why the company issued new shares in the same quarter — is in the MD&A and the notes.
What happened
Alphabet (GOOGL) runs Google Search, YouTube and Google Cloud and is among the U.S. stocks most widely held by Korean retail investors.
Its 10-Q for the second quarter of 2026, filed July 31, shows revenue of $119,800m, up 24% from a year earlier, and operating income of $40,770m, up 30%. The business did well.
Net income, however, was $112,193m — four times the $28,196m of a year earlier and 2.8 times operating income. The line that made the difference is 'Other income (expense), net': $97,983m, against $2,662m in the same quarter of 2025. The MD&A explains: Q2 other income of $98.0bn "included net gains on equity securities of $99.0 billion, primarily related to unrealized gains in our equity securities portfolio from SpaceX and a private company."
In the same quarter the company also moved in the opposite direction. Having authorized a $70.0bn buyback in April 2025, it repurchased no shares in the first half of 2026 (against $28,306m a year earlier), and in June it issued Class A and Class C common stock and mandatory convertible preferred stock for $49.6bn net. First-half net debt issuance was a further $56,226m.
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The MD&A 'Executive Overview' states that Q2 other income of $98.0bn 'included net gains on equity securities of $99.0 billion, primarily related to unrealized gains in our equity securities portfolio from SpaceX and a private company.' The cash flow reconciling item 'loss (gain) on debt and equity securities' is $135.8bn for the first half.
Is the gain cash?
No. No shares were sold, and $94.1bn of SpaceX shares carried sale restrictions at June 30. The company notes that these marks can move earnings substantially from quarter to quarter.
Why issue new shares?
The 10-Q says the June issuance of common stock and mandatory convertible preferred raised $49.6bn 'for general corporate purposes, including capital expenditures to scale AI infrastructure and global compute.' How the gain, the buyback pause and the issuance read together is covered in the subscriber section.
Where can I verify these numbers?
On SEC EDGAR: Alphabet's Q2 2026 Form 10-Q (accession 0001652044-26-000071), statement of income and cash flows, the equity securities table and footnotes in the financial instruments note, the stockholders' equity note and the MD&A.
How aiSwingX™ wrote this
We read the filing on SEC EDGAR in full — statements, notes, MD&A. Press releases and news are not used as sources.
Every figure is reconciled to its location in the filing and to XBRL data. One mismatch means no publication.
An editor reviews before publication; any later change is recorded in the revision history.
Alphabet Form 10-Q for Q2 2026 (filed 2026-07-31): consolidated statement of income and cash flows, Financial Instruments note (equity securities, SpaceX sale restrictions), Stockholders' Equity note (issuance, preferred, repurchases), MD&A 'Executive Overview' and 'Liquidity' · SEC EDGAR · This article is not investment advice. Disclaimer
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aiSwingX™ analyzes US filings and reports them as news investors can read.
