Alphabet had future purchase commitments of $924 billion at the end of September 2026, against a Google Cloud revenue backlog of $561 billion, Chief Financial Officer Anat Ashkenazi said on the company’s third-quarter earnings call on 28 October 2026.
By our arithmetic, that is $1.65 of commitments for every $1 of Cloud backlog. At the end of March 2026 the ratio was $0.72, based on Alphabet’s 10-Q, which put commitments at $332.4 billion and the Cloud backlog at $462.3 billion.
A vertical news Short narrated from the published headlines and opening lines of this piece and three related FourWeekMBA pieces on Google.
Business Pill · Capex and Depreciation
An evergreen Business Engineer explainer on capital expenditure and depreciation. It explains the general idea only and does not discuss Alphabet’s backlog or commitments.
The key insight: By our arithmetic, Alphabet’s purchase commitments went from $0.72 to $1.65 for each $1 of Google Cloud backlog between March and September 2026, as commitments reached $924 billion and the backlog $561 billion.
Ashkenazi told analysts that “Google Cloud’s backlog was $561 billion in the third quarter, with the majority of the backlog related to typical GCP contracts”. She added: “We expect to recognize just over 55% of the total backlog as revenues over the next 24 months”.
On spending, she said Alphabet had “future purchase commitments of $924 billion, and precommencement leases and other obligations of $152 billion”. She said these amounts “reflect the maximum contractual obligations”, and that “a number of these agreements have variable pricing and volume flexibility, which could result in lower spend”.
Alphabet’s results release and slides for the quarter do not give a backlog figure; the numbers come from the call. Alphabet’s 10-Q for the quarter had not been filed when we checked SEC EDGAR.
Google Cloud revenue backlog and Alphabet’s purchase commitments and other contractual obligations, $ billions, end of quarter, March to September 2026. September figures are from the CFO on the 28 October 2026 earnings call; earlier figures from Alphabet’s Forms 10-Q. Commitments are company-wide maximum contractual obligations. Ratios are our arithmetic.
Quarter by Quarter
Alphabet’s 10-Qs put the Google Cloud backlog at $462.3 billion on 31 March 2026 and $513.9 billion on 30 June 2026. With the $561 billion on the call, the backlog grew $51.6 billion in the second quarter and $47.1 billion in the third, by our arithmetic.
Purchase commitments and other contractual obligations were $332.4 billion on 31 March 2026 and $811.0 billion on 30 June 2026, according to the same filings. The 10-Qs say they “primarily relate to costs for technical infrastructure and inventory through long-term supply agreements and open purchase orders”.
By our arithmetic, commitments rose $478.6 billion in the second quarter and $113.0 billion in the third, while the ratio to the Cloud backlog went from $0.72 to $1.58 to $1.65.
Before 2026, Alphabet reported one company-wide figure. Its 10-Q for the third quarter of 2025 gave $157.7 billion of revenue backlog, “primarily related to Google Cloud”, and its 2025 10-K gave $242.8 billion at 31 December 2025.
A Change in How Backlog Is Counted
Alphabet’s first-quarter 2026 10-Q says: “In the first quarter of 2026, we elected to change our reporting of revenue backlog to now also include contracts with an original expected term of one year or less”. It puts that portion at approximately $7.3 billion on 31 March 2026.
The 10-Qs for the first two quarters of 2026 said Alphabet expected to recognise “just over 50 %” of its revenue backlog over the next 24 months. On the call the CFO gave “just over 55%”.
What the Backlog Covers
Applied to the $561 billion, 55% is about $309 billion due within 24 months, by our arithmetic. The CFO said the share applies to the “total backlog” and did not say whether that meant Google Cloud’s figure or Alphabet’s.
On the call, Ashkenazi said that when Alphabet signs an agreement to sell TPU systems, “you’ll first see that showing up in our backlog. And then we start building inventory”. Google Cloud CEO Thomas Kurian said “all of the inventory for TPU systems are associated with committed contracts”.
As we read the call and the filings, the order book and the spending book are both growing, but the spending book grew faster: commitments rose $591.6 billion in six months against $98.7 billion of added Cloud backlog, by our arithmetic.
The CFO tied the two together for TPU systems: she said a signed TPU agreement shows up first in backlog, and then Alphabet starts building inventory. Kurian said all TPU-system inventory is associated with committed contracts.
The CFO also said the $924 billion is a maximum, and that variable pricing and volume flexibility in some agreements could result in lower spend.
“These dollar amounts reflect the maximum contractual obligations. However, a number of these agreements have variable pricing and volume flexibility, which could result in lower spend”
Three Implications
FOR GOOGLE CLOUD The CFO said just over 55% of the total backlog is expected to be recognised as revenue over the next 24 months, up from just over 50% in Alphabet’s 2026 10-Qs.
FOR THE BALANCE SHEET Alphabet’s 10-Qs say the commitments primarily relate to technical infrastructure and inventory through long-term supply agreements and open purchase orders.
FOR COMPARISONS Before 2026 Alphabet gave one company-wide backlog figure, and in the first quarter of 2026 it began counting contracts of one year or less, about $7.3 billion at the time.
The framework argues: “The $1T capex cycle is being underwritten by a $1T concentrated demand commitment from two counterparties whose combined free cash flow is deeply negative.”
Alphabet’s call adds the other side of one hyperscaler’s ledger: $924 billion of its own purchase commitments against a $561 billion Cloud backlog. The framework does not discuss these figures, and the call did not name the customers behind the backlog.
What Is Not Established
The commitments are company-wide. Alphabet says they cover technical infrastructure and inventory, and its filings add content licenses and energy contracts; they are not all for Google Cloud. Our ratio sets a company-wide maximum against one segment’s backlog, as a scale comparison.
The figures are maximum contractual obligations, which the CFO said could result in lower spend. The call did not split the $561 billion by customer or between TPU system sales and other Google Cloud contracts beyond saying the majority relates to typical GCP contracts.
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Google Cloud’s backlog grew to $561 billion in the third quarter, while Alphabet’s purchase commitments rose to $924 billion: by our arithmetic, $1.65 of commitments for each $1 of Cloud backlog, up from $0.72 six months earlier.
A note on sourcing. September 2026 figures come from Alphabet’s third-quarter earnings call on 28 October 2026 (CFO Anat Ashkenazi; Google Cloud CEO Thomas Kurian), quoted from the webcast captions. Earlier figures come from Alphabet’s Forms 10-Q and its 2025 Form 10-K, filed with the SEC. Ratios, differences and multiples are our arithmetic; linked earlier pieces carry their own sources.
Gennaro Cuofano is a CRO and tech executive who has worked in AI since late 2015, starting with bringing NLP, natural-language generation, voice and chatbot products to the marketing industry. His background is in law and finance: he holds a Master's degree in Law and an International MBA with an emphasis on corporate finance (LUISS Business School and the University of San Diego, 2012), and worked as a financial analyst at a real-estate investment firm in San Diego and as an assistant controller. His work focuses on business model strategy, business engineering and, more broadly, structural analysis: how companies make money, read from their own filings. He created FourWeekMBA and leads research there and at The Business Engineer, his newsletter on AI and business strategy, with over 95,000 subscribers and more than 1,000 published analyses. His writing has also appeared on Entrepreneur (for example, How to Digitize a Family Business in Europe) and HackerNoon. Find him on LinkedIn and Substack. See how we source.
