In an after-hours earnings call, Google reported record revenue of $102.35 billion for Q3 2025, with YouTube accounting for $10.26 billion of that thanks to advertising earnings.
Alphabet and Google CEO Sundar Pichai called the quarter “terrific,” with “double-digit growth across every major part of our business.” He attributed much of the growth–a 16% year-over-year jump for overall earnings, 15% YOY for YouTube’s ad revenue, and 33% YOY for net income of $34.98 billion–to Google’s dogged pursuit of braiding some sort of generative AI into absolutely everything it offers, whether creators like it or not.
“We are seeing AI now driving real business results across the company,” he said.
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As for YouTube specifically, though, Pichai pointed to Shorts. He says the vertical-upload format, originally introduced to compete with TikTok, now generates more revenue per watch hour than long-form content.
This reveal isn’t entirely a surprise: YouTube has increased its short-form ad offerings, and over on our weekly brand reports, where we track every sponsored video on YouTube, we’ve seen more and more sponsored Shorts, indicating brands are embracing Shorts for all sorts of marketing.
But we do wonder what this means for creators who are primarily making long-form content. Have their ad earnings already begun to take a dip? Will that trend continue? When YouTube first introduced Shorts, its own revenue dropped as viewer attention shifted away from long-form to the shiny new toy, which was unmonetized at the time. We also saw a broader impact with creator companies like Spotter, which laid off 40% of its staff after missing financial goals due to the rise of short-form pulling views from YouTube’s long-form bread-and-butter. Now that Shorts are here to stay, are long-form creators going to have to cope with continued financial challenges?
Based on Pichai’s comments, Google isn’t worried about that. It’s happy to be getting the bag for itself.
Pichai also highlighted YouTube’s introduction of AI tools for creators and its exclusive broadcast of the Sept. 5 Chiefs/Chargers NFL game, which saw 19 million viewers and set a record for most concurrent users on a YouTube livestream.
While Alphabet may have hit record revenue, its costs continue to mount, too. With this earnings call, it upped its capital expenditures estimate for this year from $85 billion to $91-93 billion. A lot of that money will, unsurprisingly, be put into AI, funding things like data center construction and running generative models. (There’s also the $24.5 million it’s paying to Donald Trump to settle a lawsuit over YouTube suspending his channel following the Jan. 6 riots at the Capitol.)
Some of the cash will go into growth. Related to that topic, YouTube is getting something of an organizational rework that will see it shuffle executives and bring in at least one fresh exec. Longtime executive Christian Oestlien has been tapped to lead a newly created Subscriptions Products group; YouTube Premium, YouTube TV, and YouTube Music will all fall under that umbrella. Meanwhile former Chief Product Officer Johanna Voolich will lead a new Viewer Products team, and YouTube is on the hunt for an exec to run another team specialized to deliver on “Creator & Community Products.”
2026 operations will be even more expensive, CFO Anat Ashkenazi said.
