Alphabet was an early investor in Space Exploration Technologies, more commonly known as SpaceX. This was obviously a massive success story and made Alphabet a ton of money when it went public. However, under accounting rules, Alphabet must report any investment gains as net income, even if it didn’t sell. As of June 30, Alphabet’s SpaceX position totaled $94.1 billion. That accounted for a majority of its net gain on securities of $99 billion for the quarter, but not all of it. <\/p>\n This will cut both ways, as Alphabet’s net income will take a hit when SpaceX’s stock declines. Since June 30, when Alphabet’s Q2 ended, SpaceX’s stock has declined by over 30%. If SpaceX’s stock remains depressed throughout Q3, Alphabet’s net income in Q3 will be negatively impacted. <\/p>\n So, just because Alphabet posted one of the most profitable quarters for any company, ever, doesn’t mean that it’s all sustainable. However, don’t write all of Alphabet’s quarter off as just a one-time boost from SpaceX. <\/p>\n Instead, investors should also look at Alphabet’s operating income, which excludes investment gains. If you solely look at that, Alphabet’s operating income rose an impressive 30%, one of its better quarters over the past three years. <\/p>\n I think this is probably the best metric to look at while the SpaceX gains are digested throughout a year of results, and any company that’s growing its operating income at a 30% clip is worth considering, as that’s far faster than the average business grows. This growth rate could accelerate for the foreseeable future as well, thanks to the strength of AI spending. <\/p>\n Alphabet’s fastest-growing division, Google Cloud,<\/a> saw its revenue rise 82% year over year and posted an operating margin of 35.6%. Companywide, its operating margin was 34%. Having a fast-growing division that’s more profitable than the company as a whole is a recipe for success as an investor. I think Alphabet will continue to beat expectations as long as AI spending increases. With that being the general outlook for the foreseeable future, I’m bullish on Alphabet’s stock and think it will easily crush the market over the next few years.<\/a> <\/p>\n Should you buy stock in Alphabet right now? <\/p>\n Before you buy stock in Alphabet, consider this: <\/p>\n The Motley Fool Stock Advisor analyst team just identified what they believe are the\u00a010 best stocks<\/a> for investors to buy now\u2026 and Alphabet wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. <\/p>\n Consider when Netflix made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation,\u00a0you’d have $397,405!* Or when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $1,344,091!* <\/p>\n Now, it’s worth noting\u00a0Stock Advisor’s total average return is 953% \u2014 a market-crushing outperformance compared to 214% for the S&P 500.\u00a0Don’t miss the latest top 10 list, available with\u00a0Stock Advisor, and join an investing community built by individual investors for individual investors. <\/p>\n See the 10 stocks \u00bb<\/a> <\/p>\n *Stock Advisor returns as of August 8, 2026. <\/p>\n Keithen Drury<\/a> has positions in Alphabet. The Motley Fool has positions in and recommends Alphabet. The Motley Fool has a disclosure policy<\/a>. <\/p>\n<\/a> Image source: Getty Images. SpaceX helped Alphabet out in the quarter <\/p>\n
<\/a> GOOG Operating Income (Quarterly YoY Growth)<\/a> data by YCharts<\/a> <\/p>\n