Google Hits 350 Million Paid Subs, But YouTube’s Ad Story Gets Tricky

Alphabet dropped its Q1 earnings today, and the headline number is 25 million new paid subscriptions across Google’s services in just three months. That brings the total to 350 million, up from 325 million at the end of 2025. The usual suspects are driving this: YouTube Premium and Google One, the cloud storage bundle that now includes access to advanced Gemini features.

I’ll be honest — I was hoping for some concrete Gemini subscriber numbers. Alphabet didn’t offer any. Not for total subs, not for monthly active users. The last figure we had was 750 million users, and that was from the prior quarter. The company pointed to a 40% quarter-over-quarter increase in paid monthly active users for Gemini in the enterprise, but again, no hard count. It feels like they’re either waiting for a bigger milestone or the numbers just aren’t where they want them yet.

The Google One bundling strategy is smart, though. You get cloud storage plus AI perks, and it’s clearly working — Google One is one of the two services specifically called out as growth drivers. That’s a nice way to boost adoption without having to pitch Gemini as a standalone product.

Now, the YouTube part is where things get interesting. YouTube ad revenue came in at $9.88 billion for the quarter. Wall Street wanted $9.99 billion. That’s a miss, even though it’s still up 11% year-over-year. The issue is structural: as more people sign up for YouTube Premium to escape ads, ad revenue takes a hit. Sundar Pichai warned about this last quarter, and now we’re seeing it play out.

Last year YouTube’s total revenue — ads plus subscriptions — crossed $60 billion. Q4 2025 alone brought in $11.4 billion from ads. So this quarter’s $9.9 billion feels like a step back, even if it’s still growing year over year. The shift from ad-supported viewing to ad-free subscriptions is real, and it’s going to keep making quarterly comparisons messy.

Alphabet’s stock is up after the report, largely because overall revenue hit $109.9 billion and cloud revenue finally topped $20 billion. That’s healthy growth. But the YouTube ad miss is the kind of detail that will keep analysts talking on the earnings call.

I’d like to see Google break out subscription revenue for YouTube separately. Right now everything gets lumped into “other revenues,” and it’s hard to tell how fast Premium is growing relative to the ad business. Without that transparency, we’re left guessing whether the trade-off is worth it.

For now, the story is clear: subscriptions are booming, AI is bundled in, and YouTube is in an awkward transition. Not a bad quarter, but not a clean one either.