Google vs OpenAI: Revenue, Profit and Business Model
Google reported $402.8B of revenue in FY2025 and $132.2B of net income. OpenAI reported $20B of revenue in FY2025 and — of net income.
Latest financial snapshot
Financial summary
Alphabet's FY2025 Form 10-K reported $402.836 billion of revenue and $132.170 billion of net income, making it one of the most profitable companies in the world. Growth accelerated in 2026: Q2 2026 revenue rose 24% year over year to $119.8 billion, operating income rose 30% to $40.8 billion and operating margin reached 34.0%. Reported Q2 net income of $112.1 billion was inflated by a $99.0 billion gain, mostly unrealized gains on equity holdings, so operating income is the cleaner measure. The trade-off is spending: management raised 2026 capital expenditure guidance to $195-205 billion, and analysts flagged negative free cash flow in Q2 2026 as data-center investment outpaced operating cash flow.
OpenAI
OpenAI reports revenue as annualized run rate rather than audited GAAP figures. The company says it reached $1 billion of revenue within a year of launching ChatGPT, was generating about $1 billion per quarter by the end of 2024, and passed $20 billion of annualized revenue by the end of 2025. Axios reported the run rate was nearing $70 billion at the end of September 2026. Funding has scaled alongside: $110 billion announced in February 2026 at a $730 billion pre-money valuation grew to $122 billion committed at $852 billion post-money by March 31, 2026, anchored by Amazon, Nvidia and SoftBank. An employee tender of about $7 billion followed in August 2026 at the same valuation. The company remains unprofitable because compute spending outpaces revenue.
Revenue and profit by year
| Year | Revenue | Net income | Margin | Growth | Source |
|---|---|---|---|---|---|
| FY2025 | $402.8B | $132.2B | 32.8% | +15.1% | Source |
| FY2024 | $350B | $100.1B | 28.6% | +13.9% | Source |
| FY2023 | $307.4B | $73.8B | 24.0% | +8.7% | Source |
| FY2022 | $282.8B | $60B | 21.2% | +9.8% | Source |
| FY2021 | $257.6B | $76B | 29.5% | +41.2% | Source |
| FY2020 | $182.5B | $40.3B | 22.1% | +12.8% | Source |
| FY2019 | $161.9B | $34.3B | 21.2% | +18.3% | Source |
| FY2018 | $136.8B | $30.7B | 22.5% | +23.4% | Source |
| FY2017 | $110.9B | $12.7B | 11.4% | +22.8% | Source |
| FY2016 | $90.3B | $19.5B | 21.6% | — | Source |
OpenAI
| Year | Revenue | Net income | Margin | Growth | Source |
|---|---|---|---|---|---|
| FY2025 | $20B | — | 0.0% | +400.0% | Source |
| FY2024 | $4B | — | 0.0% | +100.0% | Source |
| FY2023 | $2B | — | 0.0% | — | Source |
Where the revenue comes from
- Google Search advertising~12%
Auction-based text and shopping ads served alongside organic search results, generating approximately $198 billion in FY2024 through cost-per-click and cost-per-impression pricing.
- YouTube advertising~12%
Video advertising across pre-roll, mid-roll, display, and Shorts formats, plus subscription revenue from YouTube Premium, Music, and YouTube TV, totaling approximately $36 billion in ad revenue for FY2024.
- Google Cloud~12%
Infrastructure-as-a-service, platform tools, Vertex AI, BigQuery, Mandiant cybersecurity, and Google Workspace subscriptions, generating significant FY2025 revenue.
- Google Network~12%
Ads placed on third-party websites through AdSense, AdMob, and Google Ad Manager, generating approximately $31 billion in FY2024 with revenue shared with publishers.
- Other Bets~12%
Revenue from Waymo autonomous ride-hailing, Verily health technology, hardware sales (Pixel, Nest, Fitbit), Google Play commissions, and other non-advertising sources.
OpenAI
- ChatGPT SubscriptionsMajor
Consumer, team, business, education, and enterprise subscriptions.
- API UsageMajor
Usage-based developer and enterprise model access through OpenAI APIs.
- Enterprise PlatformGrowing
Business deployments, governance, custom workflows, and platform services.
- Partnerships and LicensingEmerging
Strategic licensing, infrastructure partnerships, commerce, and outcome-based AI workflows.
Business model and strategy
How it makes money
Alphabet makes money mainly by selling ads against user intent and attention. Google Search & other, YouTube ads and the Google Network together account for roughly three quarters of revenue. Advertisers bid in real-time auctions to appear next to queries or videos, and Google charges per click, view or conversion.
Growth strategy
Alphabet's growth plan has four parts: put Gemini into Search (AI Overviews and AI Mode), Workspace, Android and Chrome to keep users and advertisers engaged; sell AI infrastructure, TPUs and Gemini models through Google Cloud, backed by the Wiz security platform acquired in March 2026; grow subscriptions such as YouTube Premium, YouTube TV and Google One AI plans;
Competitive advantage
Alphabet's edge is a stack few rivals own end to end: default distribution through Android and Chrome, the largest pool of search-intent data, YouTube's video audience, its own TPU chips and global data centers, and frontier models from Google DeepMind.
OpenAI
How it makes money
OpenAI earns revenue in three main ways. First, ChatGPT subscriptions: consumer tiers such as Plus and Pro, plus Business, Enterprise and Edu seats sold to organizations. Second, the API platform, where developers and companies pay per token to build OpenAI models (GPT, reasoning, image, audio and embeddings) into their own software.
Growth strategy
OpenAI is growing on four fronts: selling ChatGPT and Codex into enterprises, turning ChatGPT into a broader 'super app' with agents, shopping and apps inside the chat, building its own compute through the Stargate data center program and chip partnerships, and moving into hardware through the 2025 acquisition of Jony Ive's io.
Competitive advantage
OpenAI's advantage is distribution plus scale. ChatGPT is the most widely used AI assistant, with OpenAI citing more than 900 million weekly users in February 2026, which gives it a direct consumer channel that rivals have to buy or build.
Questions about Google vs OpenAI
Which company has higher revenue — Alphabet Inc. or OpenAI?
Alphabet Inc. reported $402.8B (FY2025), while OpenAI reported $20.0B (FY2025). By last reported revenue, Alphabet Inc. is the larger business, with OpenAI reporting a smaller revenue base.
What is the market cap of Alphabet Inc. vs OpenAI?
Alphabet Inc. has a market capitalisation of $4.31T. A public market cap figure for OpenAI was not available (it may be privately held).
Which is more financially efficient — Alphabet Inc. or OpenAI?
Alphabet Inc. generates $2.11M / employee in revenue per employee, while OpenAI generates $4.44M / employee. OpenAI shows higher revenue efficiency per headcount, though this reflects business model differences — capital-light software companies routinely outperform labour-intensive manufacturers on this metric.
How do Alphabet Inc. and OpenAI make money?
Alphabet Inc. and OpenAI generate revenue in fundamentally different ways. Alphabet Inc.: Alphabet makes money mainly by selling ads against user intent and attention. OpenAI: OpenAI earns revenue in three main ways.
Is Alphabet Inc. bigger than OpenAI?
By last reported revenue, Alphabet Inc. ($402.8B (FY2025)) is the larger company compared to OpenAI ($20.0B (FY2025)). Revenue scale is one dimension of size — market capitalisation, employee count, and geographic reach are also relevant depending on the context.
Figures come from each company's filings and the sources linked beside them. Amounts reported in another currency are shown in US dollars at an approximate rate and marked with ~. Back to the Google vs OpenAI overview